On 7th Aug 2021 Central Bureau of Investigation has booked one of the biggest bank scam lead by Kanpur based Shri Lakshmi Cotsyn of Rs. 6833 crore to a consortium bank finance of 10 banks led by Central Bank of India, officials said on Saturday.

Shri Lakshmi Cotsyn was started in the year 1993 by Mata Prasad Agarwal. It’s headquarter is located at krishnapuram in Kanpur. Its plants are located in Fatehpur, Haryana, Noida and Uttarakhand. The company is in the textile business and is the manufacturer of bulletproof jackets, defence products, blast-proof clothes for army vehicles and other products.

What is the Case of Shri Lakshmi Cotsyn ?

In 2005-06 the company decided to diversify its business into the production of denim fabric. A loan of Rs. 85 crore was taken from banks for this business. They also setup units in Roorkee and Haryana to increase its production capacity.

In 2010, it took a loan of Rs. 693 Crore from the Central Bank of India for the production of technical textiles and decided to double its business. Unfortunately plan did not go well and they could not return the amount taken from the bank till date.

As per report Agarwal’s different companies are indebted of about Rs. 5200 crore out of which bank has declared Rs. 2700 crore as a default.

Central Bank of India declared the loan account a fraud on July 20, 2020 and reported to the RBI. Being the consortium leader Central Bank of India out of 10 other banks suffered the most with a total amount of Rs. 1361.56 crore.

Present Scenario in Shri Lakshmi Cotsyn case

Based on the complaint of CBI, FIR is registered on the following key persons of Shri Lakshmi Cotsyn:

Mata Prasad Agarwal – Chairman cum Managing Director
Pawan Kumar Agarwal – Managing Director and Guarantor
Sharda Agarwal – Director and Guarantor
Devesh Narain Gupta – Deputy Managing Director.

This scam is considered bigger scam after Nirav Modi scam. However, bank auctioned their four properties for loan recovery but still had to go through a lot.