Just out of insolvency, Kwality Ltd now under CBI net for duping banks of Rs 1,400 crore
Another corporate debtor undergoing insolvency proceedings finds itself on the wrong side of the law. The Central Bureau of Investigation has registered a case against Delhi-based private dairy company Kwality Ltd for causing a loss of Rs 1,400 crore to a consortium of bank led of Bank of India (BoI). The complaint against Kwality Ltd has been filed by BoI.
CBI has named in its case the borrower Kwality Ltd, Rajouri Garden, New Delhi, its former promoter Sanjay Dhingra, and directors Siddhant Gupta, Arun Srivastava and other unknown persons.
According to the complaint, Kwality Ltd, its ex-promoter and other directors have cheated the BoI-led consortium comprising BoI (lead bank), Canara Bank, Bank of Baroda, Andhra Bank, Corporation Bank, IDBI, Central Bank of India, Dhanlaxmi Bank and Syndicate Bank to the tune of Rs 1,400 core by diverting bank funds through sham transactions with related parties, fabricated documents/receipts, falsified books of accounts and false assets and liabilities etc.
The CBI conducted raids in this regard on 21 September 2020 at 8 locations in Delhi, Saharanpur, Bulandshahr (Uttar Pradesh), Ajmer (Rajasthan), Palwal (Haryana) etc, which include the premises of Kwality Ltd.
It is to be mentioned here that Kwality Ltd has been acquired by a consortium of of Haldiram Snacks Pvt Ltd and Pioneer Securities Pvt  Ltd under the Insolvency and Bankrutcy Code for Rs 145 crore. The insolvency application against the company was filed by KKR India Financial Services Ltd was admitted by the National Company Law Tribunal (NCLT) in December 2018.
The Delhi-based dairy firm owes Rs 1,969 crore (as per the list of admitted claims of financial creditors) to over a dozen financial creditors which also include Bank of India. The company owes BoI Rs 215 crore as per the list of financial creditors last updated in November 2019.
