The resumption of investigation comes a week after the bureau arrested Syndicate Bank chairman SK Jain on allegations of graft.(PTI photo)
The Central Bureau of Investigation has reactivated a preliminary investigation into the Kingfisher Airline default case and has called for fresh information from IDBI bank and other lenders that have an exposure to the defunct airline.
The resumption of investigation comes a week after the bureau arrested Syndicate Bank chairman SK Jain on allegations of graft. In the case of KFA the bureau appears to be chasing the money trail and as of now no charges have been made against individual officers.
Speaking to ToI, Raghavan, chairman IDBI said that a preliminary enquiry was started on the KFA matter a couple of years ago. The case was dormant for some time and the CBI has again raised some queries. "This is not a fresh PE, the enquiry was started a couple of years ago. We believe that information has been sought from other banks as well," said Raghavan.
Incidentally, the matter refers to the amount lent to liquor baron Vijay Mallya's Kingfisher before 2010. In May 2010, IDBI was the first lender to recall its entire long-term loan of Rs 750 crore to the airline after it defaulted on a maturity payment of Rs 150 crore. IDBI has a total exposure of Rs 900 crore.
Lenders have been attempting to recover dues of Rs 5773 crore of which Rs 1580 crore is due to State Bank of India alone.
After KFA defaulted on its obligations and IDBI recalled its loans in 2010, the consortium of lenders restructured loans made out to KFA. The restructuring package included converting debt into equity, grant of working capital loans and fresh guarantees. However, the airline went deeper into the red and dues to banks mounted.
Lenders have said that there is not enough security to cover the loans. Although they have sold a few shares in some of the liquor companies they held as pledge bulk of the loans remain unpaid. Recently SBI chairman Arundhati Bhattacharya said that most of the bank's attempts to recover through sale of assets are being stymied by legal cases.
CBI lodges a preliminary enquiry when it either receives a complaint or information which indicates serous misconduct on the part of a public servant but when the information is not adequate to justify registration of a regular case under section 154 of the CrPC. When the verification of the complaint reveals a prima facie cognizable offence the PE is converted into a regular case.