Citing the forensic auditor’s report, the top court said on Tuesday that as soon as the loans were advanced by the bank to the Amrapali group, they were diverted to other bogus companies
of the Amrapali group.
“The submissions which have been raised on behalf of Bank of Baroda that due observance of norms was observed before sanctioning the loan, before disbursal and an independent Lenders' Engineer had been appointed in order to monitor the contract. Monitoring was done during and post disbursal of loan by Bank of Baroda. As a matter of fact, the bank has not been able to show what steps it has taken to stop the diversion of funds to third parties on the same date of disbursal of the amount,” the top court said.
The banks, the top court said on Tuesday, had also failed to ensure that the loans being advanced by them to the real estate group was used in the projects.
“As found in the forensic audit, there was no necessity of obtaining loans from the banks and it has not been used for the purpose it was obtained. The Authorities and Bankers have violated the doctrine of public trust and their officials, unfortunately, acted in collusion with builders,” the top court said.