bank never gave any written intimation as when and due to which overdues in our various loan accounts all our accounts were classified as NPA. Due to this reason we could not respond since we never knew the overdue position based on which accounts are NPA.
The trigger point was payment default by one of our overseas buyers. This buyer was covered by ECGC buyerwise policy by us. Claim with ECGC was lodged through the bank and letter for extention of due date was given to bank before alleged NPA. He made 50% payment and the bank kept on adjusting payment from other regular buyers. The branch never maintained any ledger account for bill discounting and therefore never had a track on payments receievd and adjusted and revised due dates for discounted invoices. Due to this reason we assume the accounts were classified as NPA. There were no overdues in any other account.
On complaint lodged with Banking Ombudsman towards wrong NPA classification and invocation of sarfaesi act within 3 months of alleged NPA, the bank kept on giving false, inflated and contradictory overdue figures in our Machinery Term Loan and Foreign bill discounting accounts. In the letter closing our complaint, the Banking Ombudsman has remarked "The Bank has reitrated that NPA classification of accounts was done as per Internal guidlines of the bank and Bank has all the right to take recovery action under Sarfaesi act".
The default amount in FBD account was Rs. 10 Lakhs but the bank kept on saying it is 17 Lakhs because of accounting errors. 3 payments from overseas buyers, just before NPA date, totalling Rs. 4 lakhs were never credited to any of our accounts and till date bank is unable to trace/explain where these payments have disappeared. We assume there is foul play by branch staff.
After NPA and Sarfaesi, against our various representations, the bank kept on repying that flow of working capital can be considered only after the 17 lakhs crystallised liability of FBD account is cleared. ECGC claim was in process at ECGC. We cleared the liability from our own sources and still the bank refused to cooperate and kept on adjusting these amounts towards principal and leaving the interest part unadjusted - only to somehow keep our accounts as NPA. Even after ECGC claim was received in full, the bank instead of cooperating, sold our residential property under sarfaesi act. After this sale, bank is paid 100% of its principal dues but interest in suspense account is pending. Towards this, we have argued that since entire working capital was covered under ECGC guarantee of bank, the bank should have claimed this from ECGC, which is obliged to pay as per policy terms. Bank continues to charge interest even after ECGC cliam amounts are received.
Knowing they have a weak case at Banking Ombudsman and the BO was about to write an order against the bank, the bank offcials filed OA at DRT. When we protested, they wrote back saying it is done due to limitation aspect. Due to this reason, BO refrained from passing any order.
In view of these facts, do we have a case for criminal action against the bank officials and can we proceed against them under chapter 29/30 of Sarfaesi act.