The CBI on Friday carried out searches at five locations in Chennai and Coimbatore in connection with an alleged Rs 65-crore loan default case involving a jewellery firm. The case relates to a Rs 65-crore SBI loan to Lavanya Gold Jewels sanctioned in April, 2012 for manufacturing and selling gold and antique jewellery to companies like MMTC and local market players, CBI Spokesperson R K Gaur said in New Delhi. "The credit facilities were overdue for renewal since April 16, 2013. These were secured by hypothecation of gold and jewellery and the deposit of title deeds belonging to accused promoter directors and guarantors," he said. Hypothecation is the practice where a debtor pledges collateral to secure a debt or as a condition precedent to the debt, or a third party pledges collateral for the debtor through a letter. The company allegedly defaulted on the loan and its directors N Ashok, N Balaji, V Nagendran and Manoharan were absconding, sources said. Gaur said the promoter directors allegedly decamped with the gold ornaments pledged to the bank. Also, they did not respond to the bank's requests for regularising the account. "The accused persons allegedly absconded with their family members. They defrauded the State Bank of India, Commercial Branch, Coimbatore, to the tune of Rs 65 crore," he said. Gaur said raids were conducted at several locations in Chennai and Coimbatore, including the office and the residential premises of the accused persons. Hard disks, laptops and incriminating documents were seized during the searches.
