| The ministry is conducting an investigation into the debt-ridden company. Rasiklal Mardia, chairman and managing director, Mardia Chemicals, admitted that the ministry was investigating into his company for diversion of funds. |
| Mardia, however, refuted the charges. "There is no question of diversion of funds. All the authorities including the registrar of companies of Mumbai and Delhi have all been investigating the same matter. How can there be any diversion of funds when no disbursement have been made to the company since 1995?," he said. |
| A general manager with a public sector bank said, "We will gather the details of the loan account from our Ahmedabad branch as soon as possible." |
| Mardia Chemicals' loan account has turned bad with all its lenders for many years. |
| Mardia Chemicals, the flagship of the Mardia group, owes over Rs 1,450 crore to 22 lenders, which include ICICI Bank, Bank of Baroda, Bank of India, Corporation Bank, Union Bank of India, Industrial Development Bank of India, Life Insurance Corporation, Industrial Finance Corporation of India and New India Assurance. |
| In September last year Mardia Chemicals claimed to have found a non-resident Indian buyer for its group of factories and offered to settle its creditors' dues with the sale amount. |
| But the consortium of lenders failed to reach a consensus on the proposal since the sum offered was a paltry Rs 80 crore. |
| Earlier, the chemicals company had fought a long court battle against its lead bank, ICICI Bank, in the Supreme Court challenging the constitutional validity of the Securitisation Act on the grounds that the Act was biased in favour of lenders. This was triggered by ICICI Bank taking possession of one of Mardia Chemicals' closed units. |
| The Supreme Court upheld the bank's rights to take possession and sell off assets even as it pointed out that the borrower need not pay 75 per cent of the dues before appealing against the lenders at debt recovery tribunals. |
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