Former ICICI Bank managing director and CEO, Chanda Kochhar, is currently entangled in a fresh legal controversy. A new case has been registered against her in New Delhi, along with ten others, accusing them of cheating a tomato paste company and causing a loss of Rs 27 crore.
Accused Individuals:
The FIR lists the following individuals as accused: Chanda Kochhar, Sandeep Bakshi (CEO and MD, ICICI Bank), Vijay Zagade (ICICI Bank’s ex-manager), unnamed officials of ICICI Bank’s Global Trade Services unit in Mumbai, Atul Kumar Goel (MD and CEO, Punjab National Bank), K K Bordia (ex-GM, Oriental Bank of Commerce), Akhila Sinha (AGM PNB and then Branch Head of OBC), Manoj Saxena (AGM PNB and then Branch Head of OBC), and K K Bhatia (ex-chief manager, OBC).
Background:
The case dates back to 2009 but gained prominence recently when the Patiala House Court issued an order on December 9, 2023, directing the Delhi Police to initiate an investigation. Subsequently, on December 20, 2023, the Economic Offence Wing of the Delhi Police registered an FIR, including charges of cheating and criminal conspiracy.
Nature of Allegations:
The complainant, Shammi Ahluwalia, Director of P&R Overseas Pvt Ltd (Tomato Magic), alleges that the accused conspired to present a ‘Letter of Credit’ (LoC) from a foreign bank as a genuine document. This LoC, crucial for an export order of tomato paste, was purportedly issued by the Royal Bank of Scotland (RBS) but later revealed to be from a dubious Russian bank called RBS Alliance.
Details of Fraudulent Activity:
According to the report, ICICI Bank fraudulently authenticated the LoC, knowing it was from a local Russian bank, RBS Alliance. Despite amendments to the LoC, ICICI Bank allegedly failed to verify its authenticity, resulting in a complete fraud and forgery. The complainant asserts that ICICI Bank and its officers were obligated to ensure the legitimacy of the LoC but conspired with the issuing bank in its deception.
Export Order and Financial Loss:
Tomato Magic, the complainant, received an export order from a Russian buyer for 1,000 metric tonnes of Chinese tomato paste. The order, initially valued at $10 lakh, later increased to $18.48 lakh for additional Iranian-origin tomato paste. The order was contingent on a 100% irrevocable LoC issued by an ‘A’ class bank, with ICICI Bank as the advising bank. The wrongful authentication of the LoC by ICICI Bank allegedly resulted in a significant loss of Rs 27.66 crore for Tomato Magic.
Ongoing Legal Proceedings:
On December 12, the Supreme Court adjourned the hearing on the CBI’s petition challenging the interim bail granted by the Bombay High Court to Kochhar in the alleged Videocon loan fraud case. The next hearing is scheduled for January 3, 2024.
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