<p>Bengaluru: The Karnataka government has decided to withdraw its boycott of the State Bank of India (SBI) and Punjab National Bank (PNB) after the lenders repaid Rs 22.67 crore of embezzled money along with a year’s interest. </p><p>On August 12, the Finance Department issued a circular ending all transactions with the two banks accusing them of not cooperating with the government in recovering Rs 22 crore that was embezzled. Four days later, the circular was put on hold after the banks sought time to resolve the issue. </p>.Karnataka pauses for 15 days circular boycotting SBI, PNB.<p>“The SBI and PNB have paid us back a total of about Rs 23 crore (Rs 9.67 crore from SBI and Rs 13 crore from PNB), the principal, plus one year’s interest, subject to outcome of the court cases,” Additional Chief Secretary (Finance) LK Atheeq told DH. </p><p>“We have therefore decided to withdraw the circular as we have achieved substantial success in our effort to recover monies which were misappropriated almost 13 years ago. Banking with the two banks will now continue. We will continue to pursue the banks for recovery of interest,” Atheeq said. </p><p>The government had accused the SBI and PNB of non-cooperation in recovering Rs 22 crore money that was embezzled.</p>.Karnataka pauses for 15 days circular boycotting SBI, PNB.<p>The cases involve deposits made by two government entities - the Karnataka Industrial Areas Development Board (KIADB) and the Karnataka State Pollution Control Board (KSPCB).</p><p>In September 2011, the KIADB opened a one-year fixed deposit of Rs 25 crore at the Rajajinagar branch of PNB. For this, the bank issued two receipts from its Salem branch - Rs 12 crore and Rs 13 crore, respectively. While Rs 13 crore was encashed, Rs 12 crore was not returned due to an alleged fraud involving bank officials. Letters to and meetings with bank officials did not yield results, the circular stated. The matter is pending before court.</p><p>In another case, the KSPCB opened a fixed deposit of Rs 10 crore at the Avenue Road (Bengaluru) branch of the State Bank of Mysore (now SBI) in August 2013. Before maturity, bank officials apportioned the amount towards a private company’s loan on the basis of fake documents. In this case too, the bank refused to return the money and the matter is sub-judice.</p><p>The Opposition BJP had criticised the Congress government for its decision to end ties with the two banks. </p>
<p>Bengaluru: The Karnataka government has decided to withdraw its boycott of the State Bank of India (SBI) and Punjab National Bank (PNB) after the lenders repaid Rs 22.67 crore of embezzled money along with a year’s interest. </p><p>On August 12, the Finance Department issued a circular ending all transactions with the two banks accusing them of not cooperating with the government in recovering Rs 22 crore that was embezzled. Four days later, the circular was put on hold after the banks sought time to resolve the issue. </p>.Karnataka pauses for 15 days circular boycotting SBI, PNB.<p>“The SBI and PNB have paid us back a total of about Rs 23 crore (Rs 9.67 crore from SBI and Rs 13 crore from PNB), the principal, plus one year’s interest, subject to outcome of the court cases,” Additional Chief Secretary (Finance) LK Atheeq told DH. </p><p>“We have therefore decided to withdraw the circular as we have achieved substantial success in our effort to recover monies which were misappropriated almost 13 years ago. Banking with the two banks will now continue. We will continue to pursue the banks for recovery of interest,” Atheeq said. </p><p>The government had accused the SBI and PNB of non-cooperation in recovering Rs 22 crore money that was embezzled.</p>.Karnataka pauses for 15 days circular boycotting SBI, PNB.<p>The cases involve deposits made by two government entities - the Karnataka Industrial Areas Development Board (KIADB) and the Karnataka State Pollution Control Board (KSPCB).</p><p>In September 2011, the KIADB opened a one-year fixed deposit of Rs 25 crore at the Rajajinagar branch of PNB. For this, the bank issued two receipts from its Salem branch - Rs 12 crore and Rs 13 crore, respectively. While Rs 13 crore was encashed, Rs 12 crore was not returned due to an alleged fraud involving bank officials. Letters to and meetings with bank officials did not yield results, the circular stated. The matter is pending before court.</p><p>In another case, the KSPCB opened a fixed deposit of Rs 10 crore at the Avenue Road (Bengaluru) branch of the State Bank of Mysore (now SBI) in August 2013. Before maturity, bank officials apportioned the amount towards a private company’s loan on the basis of fake documents. In this case too, the bank refused to return the money and the matter is sub-judice.</p><p>The Opposition BJP had criticised the Congress government for its decision to end ties with the two banks. </p>
