Chandigarh, May 13: The board of directors of Hindu Urban Cooperative Bank, Pathankot, has been placed under suspension for “extended financial benefits to certain defaulters.” The decision was taken by Registrar, Cooperative Societies Punjab.
In a press note, Arvinder Singh Bains, Registrar, Cooperative Societies Punjab, informed on Sunday that the board has been put on notice to explain as to why action should be not be taken against it as it has failed to perform its expected duties in a transparent and professional manner.
He said the financial health of the bank has been severely eroded thereby putting the interest of the depositors of the bank at a grave risk. Bains said that the department received complaints from the public and representations from the staff of the bank regarding the mismanagement by the Board of Directors.
A detailed inquiry was conducted by the Joint Registrar, Cooperative Societies, Jalandhar Division. It was found that the board of the bank indiscriminately extended financial benefits to certain selected defaulters of the bank by charging lower rate of interest or waiving the penal interest to be charged from them by going beyond their jurisdiction and without any policy.
For instance, the board reduced the rate of interest from 13 per cent to 12 per cent in case of M/s Mahajan Lamination Works; from 12.5 per cent to 12 per cent in M/s Vikas Ventures; from 13 per cent to 12 per cent in M/s Venus Public Resort; waived the penal interest of Rs 43.39 lakh in case of M/s Transworld Sellways; Rs 26,49,321 in case of M/s Sai Enterprises; Rs 4,21,361 in case of M/s SS Timber; and Rs 62,949 in case of M/s Narinder Singh.
There are many such cases where the board has taken a decision beyond its jurisdiction and has worked in a way detrimental to the interests of the institution. In fact, the bank has to recover Rs 99.69 crores from just 44 big defaulters. Bhupinderjit Singh Walia, Deputy Registrar, Cooperative Societies, has been appointed administrator.
