Hyderabad: The Central Bureau of Investigation (CBI) has booked a case against Rajahmundry company Sri Balaji Trading Corporation (SBTC) for causing loss to Canara Bank, Siripuram Branch, Visakhapatnam, to the tune of Rs. 5.21 crores.
The investigation agency has alleged that the company, that is engaged in trading cotton yarn and lint, mortgaged a site belonging to the spouse and sons of its proprietor Potluri Sitaratnam and an existing residential building as collateral security for a loan in November 2017.
Sitaratnam passed away in late 2017 leaving behind her husband P.D.L.V Prasada Rao and her sons P. Mohana Murali Krishna and P. Soma Sekhar as legal heirs. Her husband became the proprietor of the trading company.
The investigation agency also alleged that SBTC has done hypothecation of its stock and books debts arising out of genuine trade transactions as its prime security against the OCC. However, the stocks are being stored on the premises of Vantage Spinners Private Limited.
In March 2019, the SBTC's account was declared as a 'non-performing asset' on account of non-servicing of the interest. The bank conducted an internal investigation and a forensic audit and found irregularities committed by the borrower.
The CBI has registered a case under sections 120B and 420 of the IPC and under section 13(2) of the Prevention of Corruption Act 1988 against Prasada Rao, Nandamuri Meenalaha, the director of SBTC, and unknown public servants and private persons.