Banks in shock after trader flees leaving Rs 330m debt

Birgunj: Banks in Birgunj are in shock after a trader fled with his family leaving unpaid loans amounting to Rs 330 million. A number of banks had lent him money without adequate collateral.

The borrower Nandalal Dokaniya, who owns Krishna Modern Dal Mill, has remained out of contact since the last one month. He had taken a loan of Rs 110 million by putting up his warehouse as collateral, and another Rs 220 million without security on the basis of his goodwill.

Nepal Credit and Commerce Bank (NCC Bank), Global IME and Siddhartha Bank have sealed his factory. While NCC Bank has claimed the factory by posting a foreclosure notice, the other two banks have sealed its doors.

Security personnel of all the three banks have been deployed to guard the property. NCC Bank’s notice states that the factory and other assets located on its premises have been sealed to secure the collateral put up against the loan. Two years ago, the fugitive trader Dokaniya had been honoured as the best exporter by the Birgunj Chamber of Commerce on the occasion of its anniversary. He used to re-export pulses imported from India to Bangladesh.

“The house, land, machinery and factory have been put up as collateral with NCC Bank,” said a bank official who wished to remain unnamed. “There is no multiple banking at Krishna Modern Dal.”

According to informed sources, Dokaniya had acquired the loans by showing the stocks in his godown or on the basis of letters of credit (LC) for exporting pulses.

“The banks here should have received payment from Bangladesh for the exported pulses,” said a manager of a commercial bank. “The question how additional loans were issued while previous loans remained unpaid makes the whole issue suspicious.” According to the manager, the amount might have been on hold in India with a motive to misuse it.

Badri Prasad, an employee of the factory, said that crushed pulses, paddy and husk were exported during the period mid-January to February. The residence of Dokaniya situated at Adarsha Nagar has been found to have been sold on Poush 28. Records at the Land Revenue Office (LRO) show that the house along with four plots of land had been transferred to Annapurna Jajodiya and Pawima Jajodiya.

Dokaniya had borrowed Rs 110 million from the Birgunj branch of NCC Bank. Sources claimed that the collateral (land, factory and remaining stocks) would help the bank get back only 20 percent of its investment.

The source further claimed that Dokaniya had collected Rs 40 million from Century Bank, Rs 40 billion from Global IME Bank, Rs 60 million from Siddhartha Bank, Rs 20 million from Nepal-Bangladesh Bank, Rs 20 million from Janata Bank and Rs 40 million from Nabil Bank.

source:the kathmandu post, 10 march 2014
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