New Delhi [India], November 1 (ANI): After former State Bank of India Chairman Pratip Chaudhuri was on Monday sent to judicial custody by the Chief Judicial Magistrate's court in Jaisalmer in an alleged loan scam, the bank issued a clarification.

Jaisalmer District Superintendent of Police Dr Ajay Singh told ANI that a non-bailable warrant was issued against Chaudhuri by the Jaisalmer Police on orders of the Jaisalmer court and he was arrested from his Delhi residence on Sunday and bought to Jaisalmer.

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"The former chief of SBI was arrested and presented in court on Monday," the police official said.

"According to the information received, this is a case of irregularity and fraud. The former SBI chief was presented in court today. His bail plea was rejected by the court and he has been sent to judicial custody for 14 days," he said.

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Chaudhuri, has been accused in a case related to a hotel project in Jaisalmer worth Rs 200 crore being sold for much lower price of Rs 25 crore after declaring it as non-performing asset (NPA).

The State Bank of India (SBI), in a statement, said that the hotel project was sold with due process in March 2014 after the retirement of Chaudhuri in September 2013.

"'Garh Rajwada' was a hotel project in Jaisalmer, financed by the bank in 2007. The project remained incomplete for over three years and the key promoter passed away in April 2010. The account slipped into NPA in June 2010. Various steps taken by the bank for completion of the project as well as recovery of bank's dues didn't yield desired results. Hence as part of Bank's recovery efforts, the dues were assigned to an ARC for recovery in March 2014. This sale to ARC by the bank was done through a laid down process as per the policy of the bank," the bank said.

"As recovery efforts failed, approvals for sale to ARC were taken in Jan 2014, the assignment to ARC was completed in March 2014. It transpires now that the borrower had initially filed an FIR with the State Police against the sale of asset to ARC," the bank said.

Aggrieved against the negative closure report filed by Police authorities, the borrower had filed a 'Protest petition' before the CJM court. Incidentally SBI was not made a party to this case, the bank said.

The bank added that all the directors of the ARC, including Chaudhuri, who joined its board in October 2014, have been named in the said case. However, Chaudhuri had retired from SBI's service in September 2013. (ANI)

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