Activist say bank’s decision is ‘illegal’, has filed an FIR with the Economic Offences Wing; Deputy Registrar of District Co-op Society will initiate action on NABARD report.Though many questions have been raised and against Mumbai Bank’s proposal to write off Rs 260.47 crore, 98.8 per cent of which benefits 13 sugar factories run by politicians, the Bank today passed the proposal unanimously at a Special General Meeting (SGM).Though representatives of housing societies, who form the majority of the bank’s depositors, had met with CM Fadnavis to stall the SGM, it proceeded as planned.The media was denied entry.The Director of the bank, BJP leader and former Maharashtra Navnirman Sena MLA Pravin Darekar made a public statement saying the agenda had been passed unanimously. ”We have conducted a vote with a raising of the hands. Out of 18,000 members, 700-800 members were present for the SGM. The meeting happened in the most transparent way,” said Darekar. Only 25 members are required to make quorum, so Wednesday’s turn-out showed a large uptick of interest in the bank’s activities. Darekar added, “If any member has doubts or queries we have formed a committee compromising five members that they can approach for information.”This effort to build in transparency about the massive write-off on the bank’s non-performing assets could be seen as too little, too late, after the confidential report exclusively accessed by this paper, by the National Bank for Agriculture and Rural Development (NABARD) stated in no uncertain terms, "The methods of operations of the bank cannot be construed as not detrimental to the interest of present or future depositors." Sixty per cent of these depositors are housing societies, which, will indirectly be paying for the write-off.Vivekanand Gupta, Advocate Secretary BJP Mumbai has called today’s bank decision illegal. Gupta said, “Public money is being siphoned off by those very people who were its custodian. There is huge corruption in Mumbai Bank and thus I had filed FIR with EOW on 27 March 2015, investigation is in progress and i have been following the matter. The loan to sugar factories was illegal and outside the jurisdiction of Mumbai Bank.”Mumbai Bank is the main financing agency of all affiliated co-operative societies in Mumbai district.Most of its current 19 directors are politicians, including Shiv Sena MLA Sunil Raut, BJP leaders Shivaji Nalavade and Kavita Deshmukh, Congress' Sandeep Ghanvat, and NCP's Jijaba Pawar and Siddharth Kamble, which is why the proposal has been perceived as a as a waiver for politicians by politicians.The bank claims that by passing this proposal, it will be cleansed of its non-performing assets (NPAs) and can begin with a clean slate.However, as the October 2015 the NABARD report has noted, writing off loans in the past has not decreased the bank’s bad debt. “During the 2013-14, the principal amount written off for 35 societies amounted to Rs 158.09 lakh and Interest amount written off was Rs 1616.70 lakh. Further, during the year 2014-15 the written off amount for 87 defaulting societies was Rs 1253.65 lakh under principal and interest Rs 1042.73 lakh as interest.”Also, there were discrepancies in the formula used for declaring NPAs, which has yielded undue benefits to various fraudulent entities. “[The formula] in the software was wrong in respect of bogus housing loans sanctioned and frauds in gold loan and also shortfall amount after auctioning the gold,” the report stated.Borrowing for house or house repair spiralled up dramatically – a the end of March 2013 it stood at Rs12,603 lakh and in two years, it had more than doubled to Rs 27275 lakh. While some are legitimate, the NABARD report found at least 41instances where these housing loans were fake (29 cases in Kurla, 3 in Vikhroli East and 9 in Bhandup West) even though it hadn’t been able to undertake a review of all the branches.Wednesday’s vote also lets 91 individual defaulters, with over Rs 58 lakh in debts off the hook.Two urban cooperative banks also no longer have to account for their borrowings of over Rs 2,53 cr.Sources from Deputy Registrar of Mumbai District Cooperative office told Mumbai Mirror, “By next week we are initiating action on the NABARD report.”