In a letter to the agency’s Banking Securities and Fraud Cell, K L Jagga, assistant general manager of Punjab National Bank, has accused K K Sinha, then senior manager of the bank’s Bara Hindu Rao branch, of conniving with a Vasant Kunj resident to cause PNB “damage worth lakhs”.
Sinha held the position from March 2006 till the day he was suspended last year, the bank has said.
Jagga had filed the complaint to CBI last week. Following preliminary investigation the agency registered an FIR on Wednesday against Sinha and Chandra Shekhar, the alleged co-conspirator, under IPC Sections 120-B and 420.
As per the bank’s complaint, Chandra Shekhar opened a current account at PNB’s Shastri Nagar branch in October 2005 in the name of M/s Medical Equipment Consultants and availed overdraft against security of fixed deposit receipts (FDR). Based on “self-introduction”, Shekhar then opened another two accounts at the bank’s Bara Hindu Rao branch, where Sinha was the senior manager. Subsequently, he requested a cash credit limit of Rs 68 lakh against stocks and security, the complaint said.
The bank’s complaint says Shekhar availed credit in favour of 13 other accounts he held in various banks. He later presented self-drawn cheques for purchase in these accounts and requested PNB to buy these cheques, though he was the drawee as well as the drawer. As per complaint, Shekhar got FDRs issued in his favour through these cheques and availed overdraft.
The complaint lists nine cheques presented to the bank in March and April last year — all were returned unpaid by drawee banks due to lack of funds. The complaint says Sinha, senior manager at the branch, bought the cheques. The idea, the complaint letter says, was to help Shekhar make a substantial amount of money through this fraud.
The complaint says Shekhar was allowed an overdraft of Rs 277.5 lakh against an FDR of Rs 300 lakh in one of his cheques. The FDR limit was then raised to Rs 370 lakh on the basis of cheques for another Rs 100 crore. But, the bank has told the CBI, while the entire amount was released on the same day, cheques for buying the FDRs were returned unpaid to the bank a couple of days later.
The complaint also mentions other cases where basic banking safety norms were flouted — seemingly for the benefit of Chandra Shekhar. The bank estimates approximately Rs 5.7 crore was outstanding in Shekhar’s accounts, “and this could not have happened without the connivance of a bank official”, the complaint claims.
In his complaint, PNB’s K L Jagga has said, “KK Sinha, senior manager, purchased the cheques beyond his vested loaning powers with ulterior motives to cause gain to Chandra Shekhar.”