The show-cause notice, sent to the bank on February 1, 2003, asks the bank to explain several irregularities. Within a month after this notice, the bank’s licence was revoked. Key points raised in the notice:

• Six of the top 10 defaulters of the bank who received loans without proper sureties were linked to relatives of Pratibha Patil: four relatives got loans (including her nephew Kishor Dilipsingh Patil and niece Anjali Dilipsingh Patil) while in two cases, her relatives stood guarantee for loans given to others.

• Two loans to her relatives added up to more than the bank’s total share capital of Rs 37 lakh. A loan of Rs 36 lakh was granted to Rajeshwari Kishorisingh Patil (daughter-in-law of Pratibha Patil’s brother, Dilipsingh Patil) and another Rs 20 lakh to Ritu Randhisingh Patil (also Dilipsingh Patil’s daughter-in-law).

• The notice states that these specific loans violated RBI rules since they crossed the 20% ceiling of the bank’s capital which was then only Rs 37 lakh.

• “Illegal” loans amounting to over Rs 40 lakh were granted to the Sant Muktabai Cooperative Sugar Mill which was also set up by Pratibha Patil near Jalgaon. As mortgage, the sugar mill offered fixed deposits but the loans matched the deposits which were not encashed. According to the notice, this contributed to the deterioration of the bank’s fiscal performance, leading to its liquidation.

• Instead of meeting SC/ST reservation norms in recruitment, bank employed members of Patil’s family.

... contd.