MSCB scam closure Mumbai police opposes ED's intervention plea

Mumbai, June 27 (PTI) Mumbai police on Thursday opposed the Enforcement Directorate's (ED) plea seeking to intervene over the police's closure report in the alleged Rs 25,000 crore Maharashtra State Cooperative Bank scam.
Deputy Chief Minister Ajit Pawar was named as an accused in the original case registered by the Economic Offences Wing (EOW) of city police, but later the EOW said the apex cooperative bank had not suffered any unfair losses due to the alleged fraud.
In its written response on Thursday, the EOW said a similar intervention plea of the ED had been rejected earlier by the special court for cases against MPs and MLAs.
The the central agency has filed a fresh application which repeats the same points, it said.
The EOW, which probed the alleged scam, filed its first closure report in September 2020 and the court accepted it.
But in October 2022 the probe agency informed the court that it was conducting further investigation based on points raised in protest petitions filed by the complainants and the ED.
In March this year, the EOW again sought to close the case, saying "there was no unfair loss to the bank due to the alleged fraud."
A former judge, appointed as an authorized officer by the co-operative commissioner, concluded that "there was no unfair loss to the bank due to the loans given to the factories (sugar mills)," and "the bank was recovering the amount from the factories by legal means", the closure report said.
The ED, which is probing a money laundering case linked to the scam, moved the court recently, seeking to intervene in the hearing on the closure report.
The central agency said its case was based on the EOW's FIR, and it has filed a main prosecution complaint (charge-sheet) and two supplementary charge-sheets after investigation.
The closure report would affect the prosecution complaints as well as the proceeds of crimes, the ED told the court.
The EOW had earlier registered a first information report (FIR) in the case under Indian Penal Code sections 406 (criminal breach of trust) and 420 (cheating), as well as relevant sections of the Prevention of Corruption Act, and Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act.
The FIR, which followed a high court order in August 2019, alleged that loans of thousands of crores of rupees obtained by sugar cooperatives, spinning mills and other entities from district and cooperative banks were diverted and not repaid.
Nationalist Congress Party leader Ajit Pawar and more than 70 others who were directors of the MSC Bank during the relevant period were named as accused.
The Maharashtra government suffered a loss of Rs 25,000 crore between January 1, 2007, and December 31, 2017, due to the alleged irregularities, the FIR said.

Banking and RBI regulations were violated while disbursing loans to sugar mills at very low rates and selling off assets of defaulter businesses at throw-away prices, the FIR alleged.

(This story has not been edited by THE WEEK and is auto-generated from PTI)