Hyderabad, Sep 11 (): Deccan Chronicle Holdings (DCHL) has been cited as a wilful defaulter by Central Bank of India. The bank has included the company in the wilful defaulters list sent to RBI.
The Central Bank had given a loan of Rs 57 crore. This bank is not part of the 20 banks group who gave Rs 4000 crore to Deccan Chronicle whose total debts stand at Rs 23,000 crore.
Central Bank has already filed a winding up petition with the AP High Court. Till September 2012, it had a net loss of Rs 1040 crore and in March 31, it posted a profit of Rs 2.21 crore. The balance sheet for Q1 this fiscal has not been filed.
IDBI which has to get Rs 250 crore put the four titles – Deccan Chronicle, Financial Chronicle, Asian Age and Andhra Bhoomi of the media group for sale but nobody has bought it. A case of criminal conspiracy, forgery and cheating is filed by Canara Bank against the Chairman. CBI has filed a similar case against the Deccan Chronicle promoters. DCHL approached the CDR (corporate restructuring cell) but the request was rejected.
DCHL lost the Deccan Chargers IPL team as it could not pay the fees to BCCI. A wilful defaulter is one who siphons off money from company for other purposes or does not pay the loan despite having the resources. The defaulter will neither get any loan from financial institutions for five years nor raise money to start a new business.
Lenders can change the management and move criminal cases against the promoters. A lot of time is given to the company to explain the position and if the answer is not satisfactory only the bank informs RBI about the wilful defaulter.
Every three months, banks have to submit the list of wilful defaulters if they have any. In ten days’ time, the list by Central Bank will be submitted to RBI. Finance Ministry and RBI have asked banks to start cracking down on wilful defaulters. Deccan Chronicle is a market leader in Andhra while it trails in other three Southern States.