CBI Court denies to acquit former CMD of Union Bank (e-Corporation Bank) in Parekh Aluminex Loan Fraud Case
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A special CBI court has refused to clear Ramnath Pradeep, former Chairman and Managing Director (CMD) of Corporation Bank (now merged into Union Bank of India), from the Parekh Aluminex loan fraud case.
The court said that there is enough documentary and oral evidence presented by the prosecution to suggest that the allegations against him are serious and deliberate in nature. According to the judge, the accusations appear to be part of a planned series of actions, and only a full trial can reveal the truth.
The case relates to Parekh Aluminex Ltd. and its late CMD, Amitabh Parekh, who along with others allegedly defrauded a consortium of banks including SBI, Exim Bank, PNB, and UBI. The company claimed to be the world’s largest manufacturer of aluminium foil products and had borrowed large sums of money. However, after Amitabh Parekh’s sudden death in January 2013, the company had an outstanding debt of ₹2,762 crore.
During Pradeep’s tenure as CMD in 2011, Corporation Bank gave a working capital loan of ₹60 crore to Parekh Aluminex. Later, the account turned into non-performing asset (NPA), causing a loss of ₹84.44 crore to the bank.
Pradeep requested the court to discharge him from the case, arguing that there was no evidence of his personal involvement. He said that as CMD, his role was only administrative. The decision to grant the loan was based on the recommendations of the bank’s credit department and other officers, and there were no signs of dishonesty or personal gain. His lawyer stated that the loan was sanctioned following the bank’s internal policy, and at that time no red flags were raised. He also argued that the account became NPA mainly because of the promoter’s untimely death and not because of any fault of CMD.
On the other hand, the CBI opposed his plea, accusing him of misusing his official position to sanction the loan in a wrongful manner. According to the CBI, Corporation Bank had no need to join the loan consortium since other banks had already agreed to share the enhanced exposure. Despite this, Pradeep pushed Corporation Bank into the consortium without obtaining the required clearance from the lead bank.
The CBI further highlighted that while Pradeep initially imposed strict monitoring conditions for the loan, he later removed the requirement for a “No Objection Certificate” (NOC) from the lead bank. This change, according to the agency, was a deliberate move to help release funds fraudulently and without collateral. Moreover, Pradeep continued to extend deadlines for the consortium entry, which shows his active role in supporting the borrower’s non-compliance.
The court has rejected his discharge plea and concluded that the evidence shows Pradeep played an intentional and key role in granting the fraudulent loan. His actions went far beyond routine administrative duties. Therefore, a full trial will proceed to determine his liability in the case.
More details will be released soon.
This type of incidence may be found in other public sector bank.
Like internal promotion process, there is no merit list/ transparency. Promotion of officials are distributed as per executive, top official and sold.
See and observe of internal promotion of a big PSB, how irregularities be found. This is need to investigate of internal promotion of a big bank by Regulator, PAC,CAB, detecting agencies so that ,dudh ka dudh and pani ka pani ho jayega.
Consortium of advances in PSU banks are done at times hand in gloves policies. The lead bank alongwith participating banks are influenced by promoters of the company and kick backs play a major role.Also pressure from polititicians and vested interests play large role in getting banks funds Today’s banking across all pvt n PSU banks siphon public money to make big systematic frauds
Ramanath Pradeep is one of the miscreant CMDs who was responsible for the downfall of a very beautiful Bank ( Corporation Bank). As a CMD he had enough pressure to influence and coerce the credit committee to take a fraudful decision. Committee is a mere poppet in the hand of highest administrative person. A tree dies from the top and not from it’s roots.
Those who licked the shoes of such culprits and corrupt were also partners in the crime.
“KARMA RETURNS” is very much applicable to this man. This man has targetted executives by harassing those who are not falling in line. Fall of our great CORPBANK is because of his selfish motives costing dearly the down fall of our great institition, which we will never forget or forgive.