NEW DELHI, May 22: The Delhi High Court has ordered appointment of an official liquidator to take charge of the assets of the CRB Capital Markets and also restrained the management of the company from disposing of any assets.

These orders were passed by Justice M K Sharma on Thursday on a winding up petition filed in Delhi High Court by the Reserve bank of India.Justice Sharma, while issuing notice to the company, whose chairman C R Bhansali has reportedly fled to Canada, has fixed the next date of hearing of the petition on July 22.

Later talking to newsmen, RBI counsel H S Parihar said that as per court directives, the official liquidator has been permitted to take the help of police in taking charge of the assets, books of accounts and other valuables of the company involved in financial frauds amounting to hundreds of crores of rupees. The company's total outstanding dues are more than Rs 600 crore.Parihar further said that no one appeared on behalf of the CRB and legal notices would be served at the registered office of the company.

Appearing on behalf of RBI in the High Court, senior advocate Arun Jaitley along with Parihar, contended that it was an extraordinary case of banking fraud and that the company has taken numerous unsecured loans from various banking institutions and was trying to dispose of its assets.

He also informed the court that the CBI was inquiring into the matter as to how State Bank of India (SBI) could advance an unsecured loan of Rs 58 crore to the CRB Capital Markets, which has its registered office at Punchkuian Road in the Capital.

He said the Gujarat Government has also written to RBI about loans advanced by various cooperative banks in the State to the company to the tune of Rs 50 crore and added that the total market liability of the company amounted to over Rs 400 crore.

The RBI petition pointed out that the company's total amount of deposits outstanding as on March 31, 1997, was Rs 186.38 crore.

The RBI also annexed a list of credit exposures in various banks involving CRB group as on May 16, 1997 which shows SBI's credit to the company was highest at Rs 58.09 crore followed by Bank of Tokyo Rs 7.42 crore, Bank of Rajasthan Rs 4.5 crore, Bank of Baroda Rs 4.12 crore and Bank of India Rs 4.11 crore.

In the circumstances, ``RBI is satisfied that the continuance of the CRB Capital Markets, a non-banking financial company, is detrimental to public interest and also detrimental to the interest of the depositors of the company,'' the petition said.

Jaitley further pointed out that Gujarat Finance Minister Atmarambhai M Patel, had written to RBI Governor C Rangarajan saying ``large number of cooperative banks have placed deposits with CRB group, a non-banking finance company with a network more than Rs 430 crore and sound finances. The total outstanding dues against said company is above Rs 600 crore.''

Patel had requested RBI to pass orders for the repayment of large amount of dues to the cooperative banks, whose very survival and existence was in jeopardy.

Justice Sharma exclaimed, ``How did the company having assets worth just Rs 133 crore could manage so much of loans?''

The CRB Capital Markets, it might be recalled, was incorporated on May 16, 1985 in the name of CRB Consultants (Pvt) Ltd, which became public on March 4, 1991.

The RBI, after getting several complaints about the non-payment of deposits and fresh efforts to mobilise further deposits by offering incentives, served prohibitory orders on CRB Capital Markets on April 9, 1997, restraining the company from accepting deposits and dealing with its assets.

However, it was learnt by the RBI that all the offices of the company remained closed on May 9 and its chairman Bhansali was not traceable.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.