Bhushan Steel ex-promoter arrested

In a first, India's premier economic fraud investigator, has sent the ex-promoter & MD of Bhushan Steel, Neeraj Singhal to judicial custody. This is the first arrest by an Indian investigative agency for willful loan default.

Serious Fraud Investigation Office (SFIO) is probing Singhal for allegedly siphoning-off of Rs. 2,000 crore from bank loans sanctioned to Bhushan Steel. Singal will remain in judicial custody till August 14, 2018.

Earlier, the company was pushed to bankruptcy proceedings by the lending banks and was subsequently brought by a Tata Steel subsidiary, which now holds 72.65 stake in the company. Bhushan Steel had featured in the first list of 12 companies directed by RBI to the National Company Law Tribunal (NCLT). The company owed over Rs. 50,000 crore to its lenders and following the bankruptcy proceedings the financial creditors could recover only Rs. 35,200 crore.

Meanwhile, the stock of Bhushan Steel was volatile during the morning session on Friday. The stock opened at Rs. 32.00 per share, later in slipped into negative territory. However, at 10:50 hours, it was quoting Rs. 31.65, up by 1.77 per cent on BSE.