Case number 20 in the NewsX NPA list is Nation Infotech Pvt Ltd. According to our list, the company owes State Bank of India Rs 9 crore which has now been classified as an NPA. The registered address of the company is 10, Goyal Row house, Thaltej, Ahmedabad. According to the ROC records with the Ministry of Corporate Affairs, the company was incorporated in October 2006 with an authorised capital of Rs 3 crore. The records further show that the company held it’s last AGM in September 2017 and filed its last balance sheet in March 2017.

This is a story of a company that allegedly defaulted on a loan and had their property seized by the bank but this is the first case where a property has actually been sold off to recover the money. As per the ROC records, the directors of the company are Neeraj Jagdish Parikh and Reena Neeraj Kumar Parikh. These are the same names that appear on the NewsX NPA list as well. Neither of the directors has any other companies listed under their names.

Upon further inspection of the ROC records, we found that the company has a loan worth Rs 13 crore from SBI. The two other loans worth Rs 1 crore and Rs 7 crores were both cleared in 2007. When we visited their official address, this is what we found. The property has been sold off and is currently under construction. When we spoke to the new owner of the property, he told us that he’s bought the premises from a trader who bought this land from the bank.

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As we followed the paper trail, we were able to find this auction notice issued by State Bank of India which called for an auction in February 2017. According to this auction notice, the guarantor’s Neeraj Parikh and Neera Parikh have outstanding dues worth Rs 13 crore. The same auction notice mentions two properties. The first one is Goyal Row House, the official registered address of the company, which has a reserve price of Rs 83 lakh. This is the property which we visited and found that it has a new owner.

The second property mentioned on the auction notice has a reserve price of Rs 2 crore 79 lakh rupees. The status of this property is unknown. We’ve written an email to the company, but haven’t received a response. We’ve also written to the bank inquiring regarding the status of the loan, but are yet to hear from them.

So this is what we know, Neeraj and Reena Parikh started Nation Infotech Pvt Ltd in 2006. According to our NPA list, they owed SBI Rs 9 crore and according to the ROC records, they owed the same bank Rs 13 crore. The two properties of the company have been seized by the bank of which 1 was auctioned in 2017 while the status of the second property is unknown. The ROC records mentioned a loan of Rs 13 crore under the same bank from 2007, and now a decade later at least one of the properties has been auctioned for Rs 83 lakh.

According to the SBI auction notice, the company has pending dues worth Rs 13 crore but the two properties that the bank has sold and perhaps still in the process of selling have a cumulative base price less than Rs 4 crore.

Cases like this point towards a fundamental flaw in the system. When a loan is extended and is without sufficient collateral and the company is no longer in a position to pay back it’s dues, whatever may be the amount, who then is responsible? If every NPA is not a loot and indeed there are bigger scams out there but each time a loan turns bad, it burns a hole in the banking system. Who must then be held accountable?

This was the first case where at least a part of the money was recovered by the bank by auction. In many cases, the auctions has been pending for years and years but even then, the auction amount was a mere fraction of the loan amount.

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