The CBI accused Janta Glass Limited, its directors and others of allegedly causing an unwarranted loss of around 75 crore to UCO Bank by embezzling funds raised through loans.
The company has its office in Mumbai and factory premises in Vadodara, Gujarat. Among the 10 defendants are President Jayantilal Mehta, Managing Director Umesh Mehta and Deputy Managing Director Niraj Mehta, as well as three other companies.
It is alleged that the company, its directors, loan guarantors and unknown bank officials deceived the Nariman Point branch of UCO bank in Mumbai. They fraudulently opened accounts on behalf of sellers, falsified related party transactions, created false documents, and distorted sales and purchases.
According to FIR, the company’s loan account had started showing signs of strain since 2006, when it was restructured. However, things have not improved. Subsequently, it was declared a non-performing asset in March 2011 and transferred to the asset management branch. The outstanding amount as of March 31, 2020 was 74.91 crore.
The bank managed to recover around 20 crore yen through collection procedures and the sale of pledged assets. The loan account was declared fraudulent and reported to the RBI in April 2016.
A forensic audit in May 2017 found that using the details of Mr. Umesh Mehta’s PAN card, accounts were opened on behalf of various vendors based in Vadodara. The funds were transferred to these accounts and then to J. Foundation, J. Traders and other entities, which were held by the same promoter family group. This raised suspicions of embezzlement.