CBI arrests Rotomac owner Kothari, son

After four days of questioning, the CBI on Thursday arrested Rotomac promoter Vikram Kothari and his son Rahul in connection with charges of siphoning off Rs 3,695 crore loans given by a consortium of seven banks.

Kothari and son were asked to report in Delhi on Wednesday after two days of questioning in their hometown of Uttar Pradesh's Kanpur.

Besides Kothari, the chairman and managing director of Kanpur-headquartered Rotomac Global Pvt Ltd, his son and wife Sadhana were also named in the FIR. CBI has not asked Sadhana to appear before it in Delhi though she was quizzed while in Kanpur.

"We have placed the father-son duo under arrest," a CBI spokesperson said. Kothari's lawyer Sharad Kumar Birla earlier claimed it was a "case of loan default and not fraud".

The CBI had registered a complaint on Sunday night after the Bank of Baroda, one of the consortium banks, approached the CBI with a complaint of fraud and urging agencies to ensure that the Kotharis do not flee the country. The Enforcement Directorate (ED) has also registered a separate case against him while the Income Tax department also attached 14 bank accounts of the pen manufacturer as part of its tax evasion probe against it.

According to the CBI, Rotomac allegedly cheated the consortium of Rs 2,919 crore besides interest. The Bank of India, Bank of Baroda, Bank of Maharashtra, Indian Overseas Bank, Union Bank of India, Allahabad Bank and Oriental Bank of Commerce are those who gave loans to the Kotharis.

The Bank of Baroda had claimed that in some cases, the credit sanctioned for an export order was diverted to an offshore company and later remitted back into Rotomac without executing export order. In other instances, money given for procuring goods for export was not utilised and no export order was executed.