File probe report against Setty, HC directs CBI

The High Court of Karnataka has directed the Central Bureau of Investigation (CBI) to submit the investigation report against former Minister S N Krishnaiah Setty in connection with the allegation of cheating State bank of Mysore (SBM) to the tune of Rs 7.5 crore.

During the hearing of the petition by Setty seeking the quashing of the FIR against him, Justice N Ananda directed the CBI to file the report before the CBI court.

Setty is facing allegations of borrowing 7.17 crore as housing loan in the name of 181 beneficiaries, who are employees and ex-employees of various government organisations like BMTC, KSRTC, ITI, ADE, HAL, BEML, NOVA Technology, BSNL and other firms by submitting false payslips in connivance with bank manager M T V Reddy.

Following a complaint by R D Naidu, Chief Vigilance Officer, SBM, the matter reached the High Court, that ordered a CBI probe into the allegations.

The CBI, in its report, had said that Rs 15.61 crore was borrowed in the name of 263 beneficiaries and Rs 1.47 crore borrowed in the name of 33 individuals are outstanding. Most of the loan is borrowed without the knowledge of the ‘beneficiary,’ said the report.

It also stated that Rs 20,000 was credited into the account of the then bank manager from Setty’s firm Balaji Krupa Enterprises. The loan was borrowed by showing a patch of land as guarantee at Nagavara which is now acquired by Karnataka Industrial Areas Development Board.

A similar case has been registered against former minister D Sudhakar. Both the matters have been adjourned by the court. The duo have been booked under criminal conspiracy, Section 120 (b) , Section 409 (criminal breach of trust), Section 419, (cheating by personation) Section 420, (cheating) Section 467, (forgery) Section 471 (use of a forged document knowing despite being aware that it is a forged one) of Indian Penal Code and under Sections 13 (2) and 13 (1) (d) of the prevention of corruption act.