Loan fraud case: Andhra Bank's ex-director's custody extended by one month

The FIR had alleged that Garg infused several billions of his unaccounted money in various companies through several Kolkata-based bogus shell companies

A Delhi court on Wednesday extended by a month the judicial custody of a former Andhra Bank director, arrested in a money laundering case related to alleged Rs 50 billion bank fraud involving a Gujarat-based pharma firm.

Additional Sessions Judge Ajay Pandey extended the custody of Anup Prakash Garg till May 22 after he was produced before the court.

The court noted the submissions of advocate Nitesh Rana, appearing for Enforcement Directorate, who said the investigation was still on and there were chances that the accused may influence the witnesses and temper with the evidence.

Rana also told the court that there was a possibility of the accused fleeing from justice if released.

 

Garg was arrested by the probe agency on January 12 and is currently in judicial custody. He was one of the three persons arrested in the case. The agency had in November last year held Delhi-based businessman Gagan Dhawan.

Besides Dhawan and Garg, the ED has also arrested Rajbhushan Omprakash Dixit, one of the directors of the pharma firm, who is currently in the agency's custody for interrogation. All three were arrested under the Prevention of Money Laundering Act (PMLA). The ED had lodged the money laundering case after taking cognisance of an FIR registered by the CBI.

The agency had said that during the probe, it came across "certain entries" in a diary seized by the Income Tax department in 2011, which showed various cash payments amounting to Rs 15.2 million made to one "Mr Garg, Director, Andhra Bank" by the Sandesara brothers between 2008 and 2009.

The CBI had booked Garg, the firm Sterling Biotech, its directors Dixit, Chetan Jayantilal Sandesara, Dipti Chetan Sandesara, Nitin Jayantilal Sandesara and Vilas Joshi, chartered accountant Hemant Hathi and some unidentified persons in connection with the case. It had alleged that the company took loans of over Rs 5,000 crore from a consortium led by Andhra Bank, which turned into non-performing assets.

The FIR had also alleged that the total pending dues of the group companies were Rs 53.83 billion as on December 31, 2016. It had alleged that "various cash payments were made to Garg, as reflected in the said entries, on the instructions of the Sandesara brothers, by withdrawing cash from the bank accounts of several benami companies owned by them."

It had alleged that Garg infused several billions of his unaccounted money in various companies through several Kolkata-based bogus shell companies, with the help of cash or cheque entry operators in Kolkata, in order to launder the proceeds of crime obtained by him from the Sandesaras.