ACB books Srinagar Dy Mayor, J-K bank officials for misappropriating subsidy

The newly-constituted Jammu and Kashmir Anti Corruption Bureau (ACB) has registered a case against Deputy Mayor of Srinagar and Director of Kehwa Group, Sheikh Imran, officers of Jammu and Kashmir Bank and other government officials, for alleged misappropriation of subsidy worth crores of rupees. A statement issued by ACB said, "A case under section 5(1) (d) Prevention of Corruption Act Samvat 2006, punishable u/S 5(2) of the Act r/w 420 & 120-B RPC has been registered in Police Station Anti Corruption Bureau in South Kashmir's Anantnag against Shiekh Imran Director M/S Kehwa Square Pvt. Ltd. BohriKadal Srinagar, officers of Jammu and Kashmir Bank and other Govt officials, for illegal appropriation of subsidy with inflated project cost for establishment of CA storage at Lassipora in Pulwama."

During verification conducted by the ACB in Kashmir, it came to the fore that Imran had submitted a proposal to Jammu and Kashmir Bank for the establishment of CA storage under the name and style of M/S Kehwa Square Pvt. Ltd. at Lassipora in Pulwama. As per the norms of Mission for Integrated Development of Horticulture (MIDH), a Joint Inspection Team (JIT) of various experts and government officials in association with Imran conducted spot inspection at the site.

The assessed cost of the project to Rs 33 crores with the subsidy component thereof calculated to Rs 16.50 crores, that is, 50 per cent of estimated project cost (EPC), purportedly as per the norms of Horticulture Mission for North East and Himalayan (HMNEH) states was sent to empowered monitoring committee of MIDH for final approval, the statement said. Subsequent to its approval, the state government also constituted a Committee which conducted spot inspection and physical verification and recommended release of subsidy as per norms without altering or amending the component-wise value of machinery and civil works.

"During the enquiry, it also came to light that Kehwa Group has six more business units. Sheikh Imran has raised varied loan facilities and overdrafts for these business units. The liabilities on account of loan accumulated to Rs. 138 crores. Since one of the companies Kehwa Square had turned NPA including its sister business concerns, Sheikh Imran sought one-time settlement with J-K Bank authorities. The bank finally granted wave off liabilities of Rs.33 crores. Pursuant to the one time settlement, Kehwa Group was asked to deposit Rs 105 crores in two installments with the first installment of Rs. 50 crores to be paid by March 25, 2017," the ACB claimed. The enquiry further revealed that in order to usurp the subsidy component under the garb of promoting horticulture activity or storage facility with the connivance of the Horticulture Officers and Bank Officials, the proprietor of Kehwa Group and his partners to declare the CA Store as NPA without paying even a single installment towards the bank while as the cost of the project assessed subsequently during enquiry by ACB was found much lower than the projected cost.

The enquiry revealed that this criminal design of Imran and his partners was actually executed with the active support of the officials of Jammu and Kashmir Bank through business unit namely Go Fresh whose proprietor/s Nadeem Ahmad Mayar was roped in seeking a loan term of Rs 36.10 crore with the arrangement of margin money of Rs. 1.90 crore in lieu of the proposed transfer of the lease/property rights of this mortgaged business unit, that is, CA Store Lassipora in his favour. Mayar, the statement said, obtained a loan of Rs. 36.10 crore, he physically took over the operation of the CA storage business unit without formal transfer of assets/liabilities in his favour. Ironically, the bank authorities extended the loan facility to the proposed buyer on the same property which was already under hypothecation with the bank as an asset of the principal borrower, that is, M/S Kehwa Square Pvt. Ltd.

Enquiry has further revealed that M/S Kehwa Square Pvt. Ltd. sought further concessions from the bank subsequent to the first OTS (One Time Settlement), were sought by it surreptitiously and consented to by the bank authorities whereof the second installment of Rs 55 crore, duly payable after the first OTS was further reduced to Rs 27 crore. During the enquiry, it has come to fore that Kehwa Group in furtherance of a well-knit conspiracy with respective Government agencies and bank authorities under the garb of NPA and OTS/s in mutual conspiracy illegally benefitted the proprietor/s of Kehwa Group with an illegal appropriation of subsidy amount of Rs. 16.50 crore and layering of various transactions.

"Thus, it is established that the M/S Kehwa Group has got their loan of Rs. 138 crore with J&K Bank, restructured for an amount of Rs. 78 crore and under a well-knit conspiracy Sheikh Imran and partners of M/S Kehwa Square Pvt. Ltd. was extended with covert/overt support by Officers of J&K Bank and Joint Inspection Team, dishonestly and fraudulently, who by abuse and misuse of their official position as public servants conferred undue pecuniary/monetary advantage on M/S Kehwa Group of Companies thereby causing illegal appropriation of crores of rupees from state exchequer, for personal motives," the statement said. As per ACB, more corruption cases will be registered in this regard.

On June 11, the Income Tax (I-T) department had raided the office and other business locations linked Imran in connection with Jammu and Kashmir bank case. Ten premises linked to Imran in Srinagar, Delhi, and Bengaluru were raided by the I-T sleuths. The ACB had on June 8 had registered a case under the Prevention of Corruption Act to look into allegations related to illegal or fraudulent appointments made by the officials of J&K Bank.

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