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Economy Business Why Birla was declared as wilful defaulter by UCO...

Why Birla was declared as wilful defaulter by UCO Bank

Due to the non-repayment of dues to the bank, the UCO Bank had declared the account of the Birla Surya Limited as an NPA on 3 June 2013

New Delhi: State-owned UCO Bank has declared Yashovardhan Birla as a wilful defaulter for non-payment of Rs 67.55 crore given to Birla Surya Limited.

The UCO Bank gave this loan as a part of a consortium that included the State Bank of India, Punjab National Bank and United Bank of India.

The bank has a filed suit to recover the amount from Birla, according to the information made public by the bank on its website. According to the public notice, Birla Surya Ltd had been sanctioned a credit limit of Rs 100 crore for fund-based facilities.

Birla stated in his application to UCO Bank’s corporate branch at Nariman Point, Mumbai, that the purpose of borrowing was proposed manufacturing of multi-crystalline solar photovoltaic cells.

“Due to non-repayment of dues to the bank, the account was declared non-performing asset (NPA) on 3 June 2013. The borrower has not repaid the dues owed to the bank despite several notices,” the notice read.

The notice read further, “The borrower company and its directors, promoters, guarantors were declared as wilful defaulters by the bank and their name reported to the credit information companies for public information.”

Once declared a wilful defaulter, as per the Reserve Bank of India‘s instructions, the borrower is not sanctioned any additional facilities by banks or financial institutions in the country. The unit is debarred from floating new ventures for five years and lenders may initiate criminal proceedings against the company and its directors.

The Kolkata-based bank has issued a list 665 willful defaulters and the amount outstanding that they owe to the bank, as part of name and shame exercise.

Other prominent wilful defaulters in the list released by the bank include Zoom Developers with an outstanding loan amount of Rs 309.50 crore, First Leasing Company of India with Rs 142.94 crore, Moser Baer India with Rs 122.15 crore and Surya Vinayak Industries with NPA of Rs 107.81 crore worth of repayments due.

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