The Central Bureau of Investigation (CBI) has initiated a criminal case against five officials of a private construction company for allegedly defrauding the Bank of India to the tune of ₹12.08 crore. The action follows a complaint filed by the Bank’s Deputy General Manager from the Asset Recovery Management Branch in Andheri West.
According to CBI sources, the accused are alleged to have misappropriated loan funds and diverted them in clear violation of the terms and conditions outlined in the sanction agreement. The fraudulent activities are believed to have taken place between July 2013 and December 2021, during which the bank extended credit facilities to the firm for real estate development projects in Navi Mumbai.
As per the complaint, the construction firm and its directors breached the loan agreement by failing to deposit the sale proceeds from flats and commercial units into the designated bank account. Moreover, they allegedly sold multiple units without obtaining the mandatory No Objection Certificates (NOCs) from the Bank of India — a direct contravention of the loan conditions.
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The bank further stated that the loan account was classified as a non-performing asset (NPA) as of March 31, 2016. A demand notice was subsequently issued under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. Following a Supreme Court ruling in 2023, the account was officially declared a “fraud” by the competent authority in September 2024.
The CBI has registered the FIR under relevant sections of the Indian Penal Code and the Prevention of Corruption Act, including those pertaining to criminal conspiracy, cheating, misappropriation, and diversion of funds. The ongoing investigation will focus on examining the financial transactions and the alleged misuse of loan funds.
Authorities have stated that the case represents a serious breach of banking norms and fiduciary responsibility, and underscores the need for stricter compliance and monitoring mechanisms in the real estate and banking sectors.