Mumbai, Mar 24 A special CBI court here on Tuesday convicted a retired bank manager and nine others in a 2004 loan fraud case, and sentenced them to prison sentences ranging from one year to five years.
Brothers Kashinath Jadhav and Ganesh Pandurang Jadhav, the masterminds of the crime, were sentenced to five years' imprisonment, while former bank official Metha Sastry was sentenced to one year's jail term under the Prevention of Corruption Act.
Sastry, then senior manager at the Central Bank's Prabhadevi branch in Mumbai, failed to conduct mandatory pre-sanction and post-sanction inspections. Had these inspections taken place, the bank would have found out that the so-called buyers were not in possession of the flats and the documents were fraudulent, the court said.
Then chief manager Narain Mathur died during the 20-year-long trial, leading to the abatement of charges against him.
As per the prosecution, some of the accused used 17 forged sale agreements to apply for housing loans from the Central Bank, claiming to be purchasing flats from Shreeram Sthapatya Construction in Spring Field Apartment in Vasai. They did not buy flats in reality.
Kashinath Jadhav and Ganesh Pandurang Jadhav opened bogus bank accounts in the name of the construction firm at Punjab National Bank.
Once the Central Bank of India sanctioned the loans, the disbursement cheques, which should have gone to the actual builder, were instead deposited into the Jadhavs' accounts and the amount was immediately withdrawn.
The CBI claimed that the accused bank officials did not verify the genuineness of the applicants, purpose of loan and security offered before disbursing loans of Rs 67,70,000, out of which Rs 48,63,039 was outstanding.
The owner of the construction firm testified that the signatures on the loan agreements were not his, and the flats in question had actually been sold to entirely different, genuine buyers.
The court sentenced the fake purchasers to one year's imprisonment.
