The Central Bureau of Investigation (CBI) on Monday filed a fraud case against Kwality Ltd, which makes dairy products, for cheating a consortium of banks led by Bank of India.The company is accused of Rs 1,400 crore fraud.The agency registered the case after complaint from Bank of India. The investigating agency is conducting searches at eight locations, including Delhi, Bulandshahr, Saharanpur, Ajmer and Palwal.
The CBI said Kwality is accused of cheating the banks by "diversion of bank funds, sham transactions with related parties, fabricated documents or receipts and falsified books of accounts" and creating false assets and liabilities. The Kwality Ltd had taken credit from the bank since 2010 but started defaulting on payments in early 2018. The account was classified as a non-performing asset in August 2018,
The company’s directors Sanjay Dhingra, Siddhant Gupta and Arun Srivastava have also been named in the CBI case, apart from other unknown people.The banks said in their complaint that Kwality Ltd cheated them by ways of diversion of bank funds, sham transactions with related parties, fabricated documents/receipts, falsified books of accounts and creation of false assets and liabilities.Other than Bank of India, the consortium includes Canara Bank, Bank of Baroda, Andhra Bank, Corporation Bank, IDBI, Central Bank of India, Dhanlaxmi Bank and Syndicate Bank.