Bank loan

Bengaluru-based property company arrested for defaulting on loan from Yes Bank

A Bengaluru-based property development agency has been arrested by Bengaluru police for allegedly deceiving a bank.

Cubbon Park Police have convicted Nitesh Estates Limited and its subsidiaries for allegedly deceiving Yes Bank into defaulting on a loan of Rs 712 crore. A lawsuit was filed against the company and its promoter, Nitesh Shetty, recently based on a complaint from a Yes Bank representative.

According to a complaint filed by Ashish Vinod Joshi, a representative of Yes Bank Limited in Mumbai, the company has borrowed Rs 712 crore for 12 of its projects since February 2016. However, after a few installments, the company defaulted on the loan and despite repeated reminders, unanswered.

Following the complaint, the police registered an FIR on June 19 naming Nitesh Estates Limited (NEL), Nitesh Housing Developers Pvt Ltd, Nitesh Urban Development Pvt Limited, NEL Chairman Nitesh Shetty, Executive Director LS Vaidyanathan, Independent Directors Ananthanarayanan, Kumar Nelore Gopal Krishna, Mahesh Bhupathi – an international tennis player – Executive Vice President (Operations) Pradeep Narayan, Chandrashekhar Prashanth Kumar and his main promoters.

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Speaking to Indianexpress.com, MN Anucheth, DCP Bengaluru Central Division said, “We had received a complaint from Yes Bank against three entities in the Nitesh group of companies for using loans for different purposes and breaching covenants of ready. We have already issued opinions against the accused in the case and obtained relevant documents and sent for a forensic audit and awaiting the report.

The defendants were convicted under sections 406 (penalty for criminal breach of trust), 409 (criminal breach of trust by a public official or by a banker, merchant or agent) and 420 (cheating).