Bhushan Steel bank 'fraud' case: Court directs AIIMS to constitute medical board to examine accused

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New Delhi, Jun 11 (PTI) A Delhi court has directed the AIIMS to constitute a medical board to examine an accused arrested in a money laundering case related to an alleged Rs 56,000 crore bank loan fraud involving the erstwhile Bhushan Steel Ltd.

Special Judge Jagdish Kumar passed the order on an application of the company's ex-chief financial officer Nittin Johri, arrested in January, for regular bail/interim bail on medical grounds, claiming that he was not receiving proper treatment at the jail for his “serious illness”.

The ED opposed the application, claiming that Johri's illness is not so serious that it cannot be treated in custody. The central anti-money laundering agency said an opinion can be obtained from a medical board on his condition.

“Considered the rival contentions. It is deemed appropriate if a medical board is constituted to undertake the proper evaluation of applicant's medical condition,” the judge said in an order passed on June 6.

The judge asked the AIIMS director to constitute a medical board at the earliest and directed the jail authorities to produce the applicant before it.

The judge directed the board to submit its report by July 2, 2024, when the court will consider his bail application.

The judge further directed the jail superintendent to provide “every best medical facility to the accused from a government hospital”.

“Even if the necessity arises that applicant has to be treated in specialized hospital, on the advise of doctor at government hospital, he may be provided the treatment at suggested private hospital,” the judge said.

The expenses incurred by him for treatment at a private hospital shall be borne by the accused, the judge added.

Bhushan Steel was taken over by Tata Steel Ltd in 2018 after completing the corporate insolvency resolution process, According to the ED, Bhushan Steel Limited's former managing director Neeraj Singal and his associates formed several shell companies and the promoters and entities linked to BSL "rotated funds from one company to another through a chain of multiple entities" as part of an alleged bank loan fraud.

The money laundering case stems from a charge sheet filed by the Serious Fraud Investigation Office (SFIO), an investigative agency under the ministry of corporate affairs.

The agency alleged that funds were circulated to infuse capital, buy property and for other personal purposes not intended by the banks.

The promoters, directors and the officials of BSL prepared "forged" documents and made fraudulent representations before the banks to discount letters of credit and "diverted" the funds back into their own companies with mala fide intentions, it said.

Investigators suspect that funds were "misappropriated" against the fabricated letters of credit created in favour of JSW Steel limited and Hindustan Zinc Limited.

"The misappropriated funds were diverted to other group/associated companies, causing wrongful loss to the State Bank of India and the Punjab National Bank," the ED said. PTI UK UK SK SK