A special CBI court in Ghaziabad has delivered its verdict in a significant bank loan fraud case, sentencing the proprietor of Sahibabad-based Balaji Mineral Water Company to imprisonment. The court found Ravi Kumar Garg guilty of conspiring to cheat Bank of Baroda and misusing loan funds.
The Sentence and Leniency
The court ordered Ravi Kumar Garg to undergo four months and five days of simple imprisonment along with a fine of Rs 10,000. However, in a crucial turn, Garg will not return to jail as he has already served this term during the trial stage. His final release is contingent upon depositing the imposed fine on time.
The judge adopted a lenient approach while determining the sentence. This consideration was primarily because Garg had deposited Rs 8.2 lakh to Bank of Baroda during the trial proceedings as part of a Lok Adalat settlement. Subsequently, he obtained a no-dues certificate from the bank on January 16, 2024.
Details of the Fraud and Charges
Garg was prosecuted for his role in a multi-crore loan scam that operated between 2013 and 2015. He was one of approximately three dozen individuals who allegedly benefited from this fraudulent scheme. His case file was separated from other co-accused for trial.
He faced conviction under multiple sections of the Indian Penal Code and the Prevention of Corruption Act. The charges included criminal conspiracy (120B), cheating (420), forgery of valuable security (467), forgery to harm reputation (468), using forged documents as genuine (471), and criminal misconduct under the PC Act.
The prosecution proved that Garg, in connivance with the then senior branch manager of BOB's Shalimar Garden branch, A.B. Saxena, and others, presented forged documents to embezzle loan amounts. This conspiracy caused a loss of Rs 3.5 crore to Bank of Baroda.
How the Loan Was Misused
Investigations revealed that Garg had obtained a term loan of Rs 19 lakh and an overdraft facility of Rs 4.7 lakh from the Shalimar Garden branch of Bank of Baroda. The stated purpose was to establish a reverse osmosis (RO) water plant on land owned by co-accused Naresh Kumar Sharma, to whom he paid a rent of Rs 5,000 from the loan account.
Instead of utilizing the funds for the intended purpose, Garg diverted the money. He obtained quotations for machinery from another co-accused, Gopal Mittal, but then operated the account by issuing cheques to various parties. The loan amount was funneled to entities like Sonakshi Processing India, Shri Balaji Bartan Bhandar (owned by Gopal Mittal), and Naresh Kumar Sharma.
The Central Bureau of Investigation registered the case in 2016 based on a complaint filed by the bank's deputy regional manager and AGM, Manoj Agarwal. The complaint highlighted the fraudulent activities of branch manager A.B. Saxena, who violated bank rules while sanctioning loans. These violations resulted in a total loss of Rs 5.1 crore, including interest, across 40 different loan accounts.
This verdict underscores the legal consequences of financial fraud while also highlighting the role of settlements in judicial proceedings. The case serves as a reminder of the mechanisms like Lok Adalat that can facilitate partial restitution for victims of such crimes.
