A recent forensic audit has unveiled a disturbing discrepancy in Punjab & Maharashtra Co-operative (PMC) Bank’s dealings with Prithvi Realtors and Hotels Pvt. Ltd. Though PMC Bank sanctioned loans totaling Rs 87.5 crore, no actual money was disbursed to the borrower. Paradoxically, interest kept accruing over time, inflating the outstanding dues to over Rs 150 crore.
The initial loan began as a Rs 10 crore mortgage overdraft, eventually increased and allegedly secured against a large Vasai, Thane plot. This revelation points to grave institutional failure and financial manipulation within PMC Bank, with regulators yet to clarify how such an anomaly went undetected. The public awaits accountability amid continuing silence from PMC officials.
Sanctioned but Undisbursed: Decoding the Loan Discrepancy
The forensic audit report paints a perplexing picture. While PMC Bank’s official records confirm that Rs 87.5 crore in loans were sanctioned to Prithvi Realtors, bank accounts show neither debit transactions nor any release of funds.
This implies that despite formal approval, the money never actually left the bank’s vaults. What makes matters worse is that interest continued to pile up on this “outstanding” loan amount, doubling it over time to more than Rs 150 crore, effectively inflating liabilities without any real loan disbursement.
The loan’s origin as a Rs 10 crore mortgage overdraft facility increased multiple times before reaching Rs 87.5 crore. The loan was reportedly secured using a sprawling plot of 53,680 square metres in Vasai, Thane, a detail that initially suggested strong collateral backing.
Yet, the absence of actual fund movement raises troubling questions about the true nature of this loan and whether it was used as a tool for financial engineering—to mask the bank’s real asset quality and losses. PMC Bank authorities have remained tight-lipped about these findings, prompting calls for greater transparency.
Background: The PMC Bank Crisis in Context
This case is part of a larger narrative of financial turmoil engulfing PMC Bank since 2019. The cooperative bank has been under intense regulatory scrutiny following exposures of systemic irregularities, fraudulent loan practices, and the deliberate hiding of non-performing assets (NPAs).
Much of PMC’s distress stems from extensive exposure to real estate developer HDIL, whose default triggered a liquidity crunch and regulatory actions. The Reserve Bank of India (RBI) imposed restrictions on withdrawals, suspended the board, and appointed an administrator to steer reforms.
Forensic audits following the crisis have aimed to unravel the complex web of dubious loans and accounting manipulations. The Prithvi Realtors loan anomaly underscores persistent gaps in PMC Bank’s governance and highlights how some financial irregularities may have persisted despite RBI intervention.
The Logical Indian’s Perspective
The revelations from the forensic audit serve as a stark warning about the vulnerabilities within cooperative banks’ governance and the danger of opaque financial practices.
Cooperative banks play a crucial role in India’s financial ecosystem, especially for small depositors and local businesses. Their credibility depends on transparency, ethical management, and robust regulatory oversight.
The Logical Indian urges immediate calls for systemic reforms prioritising accountability, stronger regulatory mechanisms, and enhanced transparency in reporting loan sanctions and disbursements. Without these, public trust—the foundation of all banking institutions—remains precarious.
