Assam bank violates RBI norms to fund businessman tainted in Sharada scam

In a clear violation of a Reserve Bank of India (RBI) directive, Assam Co-operative Apex Bank has facilitated payment of Rs 20.3 crore between April 5 and June 20 to North East Plantation and Commercial Private Limited, a company owned by Rajesh Bajaj, who was interrogated by the CBI in 2014 in relation to the Saradha chit fund scam.

Bajaj’s company received payments of Rs 6 crore on April 5, Rs 3 crore on April 18, Rs 2 crore on April 28, Rs 4 crore on May 2, Rs 95 lakh on June 2, Rs 80 lakh on June 9 and Rs 3.55 crore on June 20 through “Demand Bill Purchase”, a transaction method prohibited by the RBI in a circular issued on July 1, 2015.

The “Demand Bill Purchase” method allows banks to purchase a customer’s cheques in times of urgent financial need. The bank, based on the customer’s transaction history, then releases the funds to the customer. This practice was discontinued by the RBI once net banking became prevalent as customers can now quickly access funds through cheque clearance, regardless of their location.  

As per Clause 5.5 of the 2015 “Master Circular” on customer service by the RBI, local banks are permitted to earn profits through the purchase of cheques, based on a customer's previous transactions, only if the bank’s cheque clearance process is closed for any reason. This practice is particularly applicable for cheques from government departments and well-known companies. 

Also Read: Assam: Margherita MLA claims innocence in coke plant grabbing case; says will file defamation case against Akhil Gogoi

While there has been no recent instance of cheque clearance processes being halted, Bajaj’s company received the money against cheques from other banks, not from the Apex Bank. Instead of clearing his cheques, the Apex Bank directly paid money to Bajaj’s company through the “demand bill purchase” method.

Bajaj is reportedly close to the Apex Bank’s chairman Biswajit Phukan, who is a BJP MLA from Sarupathar constituency. Bajaj's social media profile displays Phukan visiting his office. The MLA, however, denies having any close connection with Bajaj except that the businessman hails from the constituency he Phukan represents in the assembly. 

On being questioned by India Today NE about this breach of RBI norms, the BJP leader acknowledged that Bajaj committed fraud by depositing cheques from different banks and withdrawing the money without clearance. He implicated branch manager Bikash Ranjan Das as a co-conspirator in the forgery. Das has since then been suspended. Phukan emphasized that those involved in the fraud would face strict punishment. 

When India Today NE contacted, Bajaj admitted to receiving money describing it as a business deal, but he denied any wrongdoing in the process.