"Mohd Shafi Dar, Ex-Chairman, J&K Co-operative Bank Ltd, who was evading arrest since the registration of the case, was today arrested and taken into custody by the ACB and his interrogation is going on," a senior officer of the ACB said.
Former chairman of Jammu and Kashmir State Cooperative Bank Mohmmad Shafi Dar was arrested by the Anti Corruption Bureau in Srinagar in connection with his alleged involvement in the 223-crore land scam involving the Jammu and Kashmir State Co-operative Bank (JKSCO), officials said on Wednesday. On May 14, the Anti Corruption Bureau (ACB) sleuths had arrested chairman of Jhelum Co-operative House Building Society (JCHBS) Hilal Ahmed Mir in connection with the alleged scam.
“Mohd Shafi Dar, Ex-Chairman, J&K Co-operative Bank Ltd, who was evading arrest since the registration of the case, was today arrested and taken into custody by the ACB and his interrogation is going on,” a senior officer of the ACB said.
A preliminary enquiry was conducted by the ACB Jammu on the allegations that Dar in connivance with the officials and beneficiary of a non-existent co-operative house building society had sanctioned an amount of Rs 223 crore fraudulently in favour of the said society under the name and style of “River Jhelum Co-operative House Colony at Shivpora Srinagar” run by Mir of Magarmal Bagh Srinagar, he said.
The investigation revealed that the so-called chairman of JCHBS had moved an application to the secretary, Cooperatives, Administration Department of Co-operative Societies, in which he sought directions to the J&K Co-operative Bank Limited for grant of financial assistance to the tune of Rs 300 crore for taking over possession of 300 kanals of land located on the outskirts of Srinagar for construction of a satellite township, the official said. He said the application was endorsed to the registrar of Cooperative Societies, J&K, for taking up the matter with the Jammu and Kashmir State Co-operative Bank.
Accordingly, the J&K Co-operative Bank, Srinagar, sanctioned a loan to the tune of Rs 223 crore without adhering to any codal formalities like obtaining the details of the society such as its balance sheet, profit and loss account business, activities being done by it, income tax returns and details of construction of the board resolutions, the official said.
During inquiry, he said, it also surfaced that the River Jhelum Co-operative House Building Society has not even been registered with the Co-operative Societies, J&K. “The accused (Mir), by acting in league with the chairman of the J&K Co-operative Bank, Srinagar and others, had prepared a fake and fictitious registration certificate in the name of the society and managed the sanction of loan to the amount of Rs 223 crores,” the official said.
He said the omission and commission on the part of the chairman of the J&K State Co-operative Bank and others, in conspiracy with Mir, constitute offences under various sections of the Prevention of Corruption Act and the Indian Penal Code and resulted in a loss of Rs 223 crores to the bank. Accordingly, a case was registered and investigation taken up, he said.
Accused Mir had managed to get issued a fake and fictitious registration certificate bearing registration March 31st of 1994 and on the basis of that certificate, a loan to the tune of Rs 223 crore was sanctioned in favour of the non-existent society without adhering to the codal formalities and without any proper security, the official said.
The loan amount was disbursed into the accounts of the land owners but the land has not been mortgaged to the bank, he said.
Further, investigation conducted by the bureau has been successful in unearthing the siphoned out funds to the tune of Rs 223 crore and amount to tune of Rs 187 crore have been frozen by the ACB, the official said. Mir was arrested on May 14 to effect the recovery of documents required in the case which are purportedly lying in his possession and also to unearth the modus operandi, and the end-use of funds and quid pro quo, if any obtained, the he said.