‘Submit report on irregularities in co-op bank in two weeks’
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The Bombay High Court Tuesday asked the Maharashtra government to find out whether an offence was registered against the Mumbai District Central Co-operative Bank (MDCCB) in relation to alleged irregularities to the tune of Rs 1,500 crore. The court was acting on a petition filed by 25 co-operative societies who have claimed that despite repeated complaints, no action was initiated by the local police or the Economic Offences Wing (EOW).
"We want to know whether an offence has been registered and if not then why it hasn't been registered. Presently, you (state) inform us what steps have been taken," said a Division Bench of Justice P V Hardas and Justice P N Deshmukh.
According to the petition, the directors of the bank had jointly taken decisions and siphoned off Rs 1,500 crore in the past four to five years in the form of bogus loans. The petition alleged that this was done without following due procedure of law and without considering the reports of loan inspectors. Moreover, MDCCB, which is the apex bank of all co-operative societies in Mumbai, sanctioned loans to societies that are in liquidation.
The petition also stated that questions were raised in respect of sale of shares and public securities amounting to Rs 172 crore in the state assembly, and the then minister of co-operatives had assured that within a month he would direct the EOW to register an FIR, but nothing came of it. In addition, even the Reserve Bank of India and National Bank for Agriculture and Rural Development have not made any inquiries into these allegations.
The state represented by additional public prosecutor Aruna Pai sought time to take instructions. The court asked the state to file its report on the same within two weeks. On November 22, a different Bench of the High Court had issued notices to the bank's directors and the co-operative department.