As banks in Punjab are doing huge write-offs, FOPSIA is in process of filing PIL in the Supreme Court
Chandigarh, Mar 20 (KNN) The Federation of Punjab Small Industries Association (FOPSIA) is in the process of filing a PIL in the Supreme Court as banks in Punjab are doing huge write-offs.
With regard to this issue, President of FOPSIA, Badish Jindal said “In Punjab alone, the banks are in the process of writing-off more than Rs 30,000 crores, out of this huge sum, there were NPAs to the tune of Rs 13,000 crores in Ludhiana alone.”
He said that the Gross NPA ratio of the nationalized banks stand at 14.7% which means that around 14 lakh crores of nationalized banks are under threat. Whereas the Gross NPA of private sector banks stand at 4.7%.
Similarly as per investigation the 94% frauds occurred in nationalized banks whereas the private sector banks accounted merely 6% of amounts more than Rs 50 crores, he added.
In a statement, he said “Now the banks are settling the large NPA’s by merely charging 19% of the principal amount. So when it comes to accounting the large companies are repaying merely 12% to 14% of their total outstanding.”
As per the FOPSIA information, this year banks are in process of writing off more than 3 Lakh crores of banks loans which means that by the end of this year the total write off of the banks may cross 8 Lakh crores.
In Ludhiana, many large companies are settling their accounts on this pattern, said FOPSIA. While, many yarn processing companies of Ludhiana took advantage of this process to settle their accounts.
A few companies in Ludhiana whose total outstanding was more than Rs 13,000 crores, have got success in settling their accounts in less than Rs 2,000 crores, which means there are huge losses to the nationalized banks, it added.
Jindal stated “Many frauds in Punjab & Chandigarh are bigger than the fraud conducted by Vijay Mallya, despite that banks are not taking any legal action against such companies.”
“There is a clear provision under act and according to the provisions of Section 120B of the Indian Penal Code, 1860, whoever is a party to a criminal conspiracy shall be punished with imprisonment of either description for a term not exceeding six months, or with fine or with both. But to save their skins the banks are in process of settling the NPA’s on throw away prices”, said Jindal.
FOPSIA is gathering the data of syphoning of funds to other countries by these companies.
However, FOPSIA confirmed that many companies have transferred huge funds to Dubai. Even after the instructions of the finance ministry to refer the cases above Rs 50 crores to CBI the banks are settling their accounts without any intimation to CBI.
The Banks are not ready to provide the data of NPA accounts for the vested interests. The banks even failed to explain that in merely 5 to 7 years how the companies can occur the losses of 100% of their total investments, said FOPSIA President.
He said that “Big frauds are involved in such settlements and higher officials of Banks are charging handsome amounts from such deals.”
As per FOPSIA investigation in many cases the asset value of the companies were more than the settlement amount.