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The CBI has registered a case over an alleged $10 million, or ₹63 crore, loan fraud involving India Exim Bank and a UK firm.
The Central Bureau of Investigation (CBI) has initiated an investigation against UK-based Hanjer Biotech (Erith) Ltd, its former directors, guarantors and associated companies over allegations of diverting funds sanctioned for a recycling project. The case was registered following a complaint by India Exim Bank, which alleged that the entire loan amount had been siphoned off instead of being used for its intended purpose.
How Did the Alleged Loan Fraud Begin?
According to the First Information Report (FIR), Hanjer Biotech entered into an agreement with Navi Infrastructure Engineering Pvt Ltd (NIEPL) for the supply of machinery required for a recycling project in the United Kingdom. The borrower submitted a project cost of $15.90 million, proposing that $5.90 million would come from promoters’ contributions while the remaining $10 million would be financed through India Exim Bank.
The bank’s executive committee in Mumbai approved the $10 million term loan in 2012. However, investigators allege that the machinery for which the financing was sanctioned was never supplied.
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How Were the Loan Funds Allegedly Diverted?
The FIR alleges that advances made towards purchasing machinery were diverted through loans extended to related parties, including Hume Synthesis Pvt Ltd. Instead of financing the recycling project, the funds were allegedly transferred through associated entities.
According to the complaint, the entire $10 million loan amount was siphoned off, resulting in financial losses for the bank. The allegations concern the use of funds originally sanctioned for machinery procurement and whether the borrower and associated entities diverted those funds for other purposes.
Who Has Been Named in the CBI Case?
The FIR names Hanjer Biotech (Erith) Ltd, a UK-based company that has since been dissolved, along with its erstwhile directors and guarantors. Navi Infrastructure Engineering Pvt Ltd and Hume Synthesis Pvt Ltd have also been named among the accused. The case additionally includes unidentified public servants whose alleged involvement forms part of the investigation.
The CBI registered the case following a complaint submitted by G Selva Kumar, assistant general manager at India Exim Bank. The complaint alleges that the bank suffered a wrongful loss of approximately $10 million, equivalent to around ₹63 crore at the relevant time.
When Was the Loan Account Declared Fraudulent?
According to the FIR, the loan account was classified as a non-performing asset (NPA) on September 29, 2014, after the borrower failed to meet its financial obligations. The account was subsequently classified as fraudulent in accordance with Reserve Bank of India guidelines.
The bank’s complaint links the alleged financial loss to the non-supply of machinery and diversion of advances to related parties. The CBI investigation will examine the allegations against the borrower, its former directors, associated companies and other individuals named in the FIR.
The allegations remain subject to investigation, and the registration of the case does not establish criminal liability.
