The Rajasthan police on Monday arrested Pratip Chaudhuri, a former State Bank of India (SBI) chairman, from his Delhi residence in an alleged loan scam involving a hotel in Jaisalmer, according to media reports. 

The case is related to properties owned by Godawan Group, which had taken a Rs 24-crore loan from SBI in 2008 to construct a hotel. 

Mr Chaudhuri’s bail application was rejected by a magistrate’s court in Jaisalmer, said the media reports. 

The reports added that allegations against Mr Chaudhuri included properties worth Rs 200 crore being sold for Rs 25 crore after the bank had seized them for defaulting on the loan. 

The Godawan properties were allegedly sold to Alchemist Asset Reconstruction Company (ARC) in 2016 when Mr Chaudhuri was the SBI chairman. 

The market value of the properties was assessed as Rs 160 crore in 2017, the reports added. The Godawan Group had approached courts after the properties were sold for lower valuation. 

Mr Chaudhuri had joined Alchemist ARC as a director after retirement from SBI. 

The present cost of the properties is estimated at Rs 200 crore. 

Meanwhile, in response to multiple media reports of Mr Chaudhuri’s arrest, SBI issued a clarification on Monday, saying the assets were sold with due process in March 2014, after Mr Chaudhuri had retired from the bank in September 2013. 

SBI also added that the reports were inaccurate and had factual errors related to the dates of sale and other details.

The country’s largest lender clarified that the project had remained incomplete for over three years and the key promoter had passed away in April 2010. The account had turned into a non-performing asset (NPA) in June 2010, and various steps taken by the bank to complete the project did not yield results. 

The bank added that the dues of the account were assigned to ARC in 2014, and it was done through a laid-down process of the bank’s policy. “As recovery efforts failed, approvals for sale to ARC were taken in January 2014. The assignment to ARC was completed in March 2014. It transpires now that the borrower had initially filed an FIR with the State police against the sale of asset to ARC," SBI said.