Yash Birla Group Chairman Yashovardhan Named Willful Defaulter For Failing To Repay Loan of Rs 67.65 cr

UCO Bank declared Yashovardhan Birla, chairman of the Yash Birla group, a wilful defaulter on June 16. The Kolkata based bank termed Yash a wilful defaulter after one of his company – Birla Surya failed to repay loans worth Rs 67.65 crore.

The bank has issued a public notice carrying a photograph of Yash which states that the Birla Group was sanctioned a credit limit of Rs 100 crore of fund-based facilities to manufacture multi-crystalline solar photovoltaic cells. The loan was sanctioned by the bank’s flagship corporate branch at Nariman Point, Mumbai. The notice mentions that the present balance outstanding is Rs. 67.65 crore plus in addition to unapplied interest from the date on NPA.

The notice stated that due to non-repayment, the bank had declared the account Non-Performing Asset (NPA) on June 3, 2013. The bank has declared the directors, guarantors, and promoters as a wilful defaulter. Their names have been reported to the credit information companies for public information.

The Yash Birla group comprises of dozen companies which include – Zenith Steel, Birla Lifestyle, Birla Power, and Shloka Infotech. However, all these companies are facing financial constraints and are not in a position to repay creditors. Last year, three of Birla’s group firms – Birla Cotsyn, Zenith Birla, and Birla Shloka Edutech came under investigation for diverting funds. In 2017, the State Bank of India had also sent a recovery notice to the Birla group for the repayment of Rs 17.8 crore.

Ironically, UCO Bank was founded in 1943 by Yash Birla’s great-granduncle, Ghanshyam Das Birla. Ghanshyam Das Birla’s brother Rameshwar Das Birla was the grandfather of Yash Birla. Yash inherited the business at the age of 23 after his parents died in an air crash. For several years, the Birla group was run by advisers. The group also owns several schools and runs charities.

The UCO bank has also declared directors of seven companies as wilful defaulters, with total unpaid dues of Rs 740 Cr. Mehul Choski, Manoj Jayaswal and Abhishek Jayaswal of Abhijeet Ferrotech and Kaizen Power are included in the lists of wilful defaulters.

A lender is named wilful defaulter when the person is not repaying the loan in the stipulated time despite his capability to repay. Apart from this, a bank can also term a lender wilful defaulter when he/she is not utilising the money for the specific purpose that he has mentioned earlier to get the loan.

Also Read: Report Says Wilful Defaulters Doubled In Last Five Years