The Criminal Investigation Department (CID) carried out a late-night raid on Tuesday at the Soubhagya Laxmi sugar factory, belonging to Bharatiya Janata Party (BJP) MLA Ramesh Jarkiholi in Gokak. Sources indicate that the extensive raid was initiated due to accusations of failure to repay a bank loan.
Authorities reported that a team of four CID members, headed by Deputy Superintendent of Police (DSP) Anjumal Nayak from the Bengaluru branch, arrived at the mill in Chikkanandi village. The team conducted a comprehensive inspection of the mill’s financial records, which included scrutinizing accounts, transactions with other banks, and relevant financial documents. The administrative staff, notably from the accounts department, underwent questioning during the operation. “Except the accounts and clerical staff, the rest of the administrative staff were allowed to go home after completion of their duty hours,” an intelligence department officer said.
The CID team left with numerous documents, account books, and banking records considered crucial for ongoing investigations. An undisclosed source within the intelligence department revealed that both CID members and officials from the sugar mill signed duplicates of the seized document list as evidence of the retrieval.
Ramesh Jarkiholi, a seven-term representative of the Gokak constituency, founded the sugar mill on December 31, 2008. The authorized share capital of the mill was ₹83 crore, and the most recent balance sheet was submitted on March 31, 2019, according to the official. Despite consenting to comply with all stipulations, Jarkiholi obtained loans amounting to ₹232.88 crore from four in-state banks spanning December 7, 2013, to March 31, 2017. Nevertheless, as of December 2023, the sugar mill had not fulfilled the repayment of the principal and accumulated interest, reaching ₹439.07 crore.
After receiving no responses to previous communications and reminders regarding loan repayment, Rajanna Muttushetty, the manager of the Karnataka State Cooperative Apex Bank, lodged a complaint on January 5, 2024. The complaint targeted Jarkiholi, who served as the managing director of the sugar mill at the time, along with four other members of its management committee. The accused individuals were charged under sections 406 (criminal breach of trust) and 420 (cheating) of the Indian Penal Code at the Vishveshwarpuram police station.
As per the complainant, the loan was designated for the creation, expansion, and upkeep of the sugar mill. Despite entering into loan agreements, the mill did not fulfill its financial commitments to the banks. The complainant additionally claimed that Jarkiholi, who occupied key positions in the mill during the loan acquisition, relinquished his duties after obtaining the loan.
“It asserts that he appointed unrelated individuals to oversee company affairs, contravening the terms stipulated by the Karnataka State Cooperative Apex Bank,” the complainant added. Furthermore, the FIR asserted that the accused breached the bank’s conditions by replacing directors without obtaining prior approval until the loan was settled.
