CBI booked Shakti Bhog Foods for a Rs 3,269 crore fraud on ten banks

The CBI booked Delhi-based Shakti Bhog Foods Limited for an alleged fraud of Rs 3,269 crore on a consortium of 10 banks led by the State Bank of India, acting on SBI's complaint. The agency booked managing director Kewal Krishan Kumar and directors Siddhrath Kumar and Sunanda Kumar, who allegedly falsified accounts and forged documents to siphon off public funds.

The 24-year-old maker of wheat, flour, rice, biscuits and cookies had grown organically for a decade — turnover up from Rs 1,411 crore in 2008 to Rs 6,000 crore in 2014. Growth stopped in 2015: the account turned a non-performing asset on inventory losses from a steep fall in paddy prices, underutilisation of capital expenditure in rice and paddy, and delayed tie-up funds, the bank's 2017 staff-accountability report noted. It was declared a fraud in 2019.

The forensic audit found the company's FY2015-16 books claimed inventory worth over Rs 3,000 crore was damaged by pests and sold at substantially low prices — contradicting its own stock and receivables audit, which showed over Rs 3,500 crore of stock in September 2015, warehouses fully stocked, and nothing obsolete or slow-moving. The company held insurance against fire, earthquake and other perils but never claimed for pest damage, and its accounts showed no receivables from any damaged-stock sale. The report also flagged round-tripping of funds, suspicious payments and fudged account books.

The damage claim collapses on its own paperwork: a pest disaster worth Rs 3,000 crore produced no insurance claim and no sale receivables.

The company's books contradicted its stock audit in the same quarter — Rs 3,000 crore destroyed versus Rs 3,500 crore stocked.

A decade of organic growth to Rs 6,000 crore made the borrower look safe right up to the NPA.

The alleged scheme hit ten banks at once, SBI-led — a textbook consortium-lending blind spot.

A borrower claiming pest-ruined stock but filing no insurance claim is telling on itself. Cross-check reported losses against stock audits and existing policies before the next drawdown.

The CBI registered its case on 1 January 2021 against the company and its three directors on SBI's complaint; the article reports the agency's investigation at that stage. The account had already been declared a fraud by the banks in 2019.