Times Now reported that Central Bureau of Investigation has filed a case against Bengaluru based Steel Hypermart India Private Limited for causing an alleged loss of over INR 200 crores to a consortium of banks. Others accused by the CBI include the company's directors Mr Mahendra Kumar Singhi and Suman Mahendra Kumar Singhi, Chartered Accountant Mr Mukesh Surana and unknown public servants. CBI conducted searches at the residential and official premises of the accused at Bengaluru in Karnataka and at Shoolagiri in Krishnagiri district of Tamil Nadu, which led to the recovery of several incriminating documents and other material evidence.
An investigation is continuing on the complaint lodged by the Indian Bank, claiming that a consortium of banks was defrauded of over INR 200.38 crores by Steel Hypermart India in connivance with others, during the period from 2017 to 2019. Credit facilities were availed by the company under consortium lending, consisting of e-Vijaya Bank, now Bank of Baroda and Indian Bank, with the latter leading the consortium.
In order to avail higher working capital limits from the consortium of banks, the company allegedly inflated its turnover, made purchase transactions with sister concerns, inflated price of its receivables, diverted funds within sister concerns, submitted fudged accounts and statements to siphon off funds of banks funds. This caused an alleged loss of over INR 168.39 crores to Indian Bank and over INR 31.99 crores to Bank of Baroda. The account became a Non Performing Asset on 30 April 2019, and was reported as fraud on 7 November 2019.