I-T dept. says co-op banks’ cash records seriously tampered with; writes to RBI
- The Income Tax Department has written to the RBI informing it about alleged illegal malpractices being deployed by a number of cooperative banks after its probe found “serious” difference in accounts, to the tune of multi-crore rupees, in the aftermath of the notes ban.
- In an analysis report, two specific instances in Mumbai and Pune have been reported where it was found that over Rs 113 crore “excess amount” of old demonetised notes was reported by the two banks to the banking regulator in order to generate black funds.
- The excess reporting of old notes had serious potential for large-scale conversion of old notes for new notes even after December 30, 2016 (the last date for the validity of the old notes).
- In this backdrop, the Reserve Bank of India had issued a circular on December 30 last year requiring all banks to deposit all old notes received till December 30, 2016 with RBI chests by the next day, ie, December 31, 2016 and also stating that old notes cannot form part of the closing cash balance of banks as on December 31, 2016.
- The Income Tax department has earlier raised serious concerns over the working of a number of cooperative banks across the country in a earlier report where it had claimed that they used “opportunity” of demonetisation to make a quick buck and indulge in money laundering worth several crores.
- The I-T probe had found that in the case of such a bank based in the small town of Alwar in Rajasthan, the directors of the bank cheated it of Rs 8 crore “by fraudulently obtaining loans in the names of 90 persons of doubtful identities” even as it was used to launder personal “unaccounted cash” of Rs 2 crore by the management.