NEW DELHI – The Central Bureau of Investigation (CBI) has registered a First Information Report (FIR) against the directors of M/s Kotson’s Private Limited for allegedly cheating the Small Industries Development Bank of India (SIDBI) to the tune of over ₹11.08 crore.
The FIR was filed by the CBI’s Special Task Branch (STB) in Delhi on January 8, 2026, following a written complaint from Ms. Suman Singh, Assistant General Manager at SIDBI.
The Accused and Charges
The CBI has named several individuals and entities in the FIR, including:
- Pawan Kumar Jain, Director of M/s Kotson’s Pvt Ltd.
- Siddharth Jain, Director of M/s Kotson’s Pvt Ltd.
- Mohnish Jain, Director of M/s Kotson’s Pvt Ltd.
- Unknown Public Servant(s) & Private Person(s).
The case has been registered under Section 120-B r/w 420 of the Indian Penal Code (IPC) for criminal conspiracy and cheating, alongside Section 7 of the Prevention of Corruption Act, 1988 (as amended in 2018).
Mechanism of the Fraud
According to the FIR, the directors of M/s Kotson’s Pvt Ltd entered into a criminal conspiracy between 2019 and 2021 to defraud SIDBI.
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- Loan Procurement: The company availed credit facilities totaling ₹12 crore (a ₹10 crore term loan in 2019 and a ₹2 crore loan in 2021) under SIDBI’s Secured Business Loan and TWARIT schemes.
- Suppression of Facts: To secure these loans, the directors offered landed property in South 24 Parganas, West Bengal, as collateral. They submitted notarized declarations affirming the property was free from all encumbrances.
- Hidden Leases: Investigation revealed that the directors had dishonestly concealed the fact that the mortgaged property was already subject to long-term leases ranging from 30 to 50 years with third parties.
- Financial Impact: The company failed to repay the installments, leading the account to be classified as a Non-Performing Asset (NPA) on October 8, 2021. The total wrongful loss caused to SIDBI is estimated at ₹11,08,27,000 as of the NPA date.
Role of Third-Party Entities
The CBI is also looking into the roles of empanelled professionals who facilitated the loan process:
- Advocate Gautam Chakraborty: Suspected of negligence or collusion for failing to report the registered encumbrances in his Title Investigation Reports.
- Valuer Firm M/s Haripriya Associates Ltd: Scrutinized for failing to mention existing tenancies in their valuation report.
Ongoing Investigation
The account was officially declared as “Fraud” by SIDBI on June 25, 2024. While the company has since undergone a Resolution Plan under the Insolvency and Bankruptcy Code (IBC), the criminal liability of the erstwhile directors remains active.
The investigation has been entrusted to Shri Jyoty Shankar Sah, DSP, CBI, STB, Delhi.
