CBI is also investigating the case of Kartik Parekh siphoning off Rs 20 crore and defrauding Bank of India (BoI) and according to the agency he may prove to be a key person in unearthing the nexus between the stock brokers and the bank employees.

Meanwhile, the sources in CBI's bank securities and fraud cell said the sleuths of the agency interrogated the assistant general manager of Bank of India's stock exchange branch BH Somaiah at the local headquarter of the agency situated at the posh Walkeshwar area in south Mumbai. Mr Somaiah is one of the senior officials of the BoI who was suspended in connection with the pay-order scam.

Kartik, who was arrested on Saturday last, March 31, at 18:20 hours was produced before the designated (holiday) court on Sunday April 1. He was also remanded to CBI custody till April 9 by the holiday judge. Before seeking his remand, the CBI in its remand application No; 8/2001 submitted that the investigation in this case has further revealed that Kartik K Parekh, Director of M/s Panther Investrade Ltd, which is maintaining accounts at BoI's stock exchange branch received proceeds of Pay Order No: 064418 dated 08/03/01 for Rs 10 crore and another Rs 10 crore vide pay order No; 064458 dated 09/03/01 issued by Madhavpura Mercantile Co-operative Bank (MCCB) and discounted by BoI.

CBI has said that Rs 435 crore has been siphoned off from his company Panther Investrade Ltd's current deposit (CD) account in favour of Nakshatra Software Pvt Ltd during 03/01/01 till date.

However, according to CBI both the accussed - Ketan Parekh and Kartik Parekh- are denying any knowledge of the fraud. But the agency has prayed before the court in favour of Kartik's custodial interrogation as it may reveal the identity of persons from the BoI who might have abbetted the crime by extending illegal accomodation. In a related development, the designated court passed an order on Tuesday allowing CBI to retain all the documents and record seized during the search and raids on the premises of the said brokers for the purpose of investigation and for use of any of them while filing the chargesheet.