RBI Former Deputy Governor KC Chakrabarty Stopped From Travelling To London

CBI issued Look out Notice against Former Deputy Governor of RBI –  Former deputy governor of Reserve Bank of India KC Chakrabarty was stopped from travelling to London in the month of May at the Mumbai airport due to reason, the Central Bureau of Investigation (CBI) had issued a Look Out Circular (LOC) against him.  LOCs are used to monitor and prevent the entry or exit of persons who may be required by law enforcement authorities. 

CBI had issued the LOC against him on charge of forgery case filed by Indian Overseas Bank against a Delhi based travel company—Airworth Travels & Tours Pvt Limited, its promoters and ‘unnamed public servants’. 

Though the FIR registered by the CBI in the case does not name K C Chakrabarty. 

K C Chakrabarty is now a NRI and lives in London. He served as deputy governor of the Reserve Bank between 2009 and 2014. He was the chairman and managing director of Indian Bank from 2005 to 2007 and the chairman and managing director of Punjab National Bank from 2007 to 2009.

Mr Chakrabarty has requested to CBI for withdrawing of LOC opened against him so that he can travel back to London. 

History

In 2007, Indian Overseas Bank had taken over the credit limit of Rs 1 crore from Punjab National Bank given to the travel company “Airworth Tours and Travels”. Subsequently, the bank increased the credit limit facilities to Rs 25 crore between 2007 and 2013. The loan is now classified as a non-performing asset (NPA). 

It is believed that Mr Chakrabarty, then the deputy governor of the Reserve Bank, had informally asked M Narendra, the then chairman and managing director of Indian Overseas Bank, to increase the credit limit to the travel company. 

Where as Mr Chakrabarty disputed this allegation by saying that “How can a bank increase the credit limit on anybody’s recommendation without proper verification of the borrower”.

He said that the he only has a professional relationship with Airworth Tours and Travels and its director Gaurav Mehra as the company has been doing his personal bookings after he demitted office in 2014. He had been informed by the Reserve Bank on January 25 this year that the CBI wanted him to attend their office in regard to the investigation in the present case. 

He was examined at length by the CBI on April 17 and April 28, and was then told that he could go. But he was stopped at the Mumbai airport on the ground that there was an LOC issued against him. 

input from ET