KADAPA: Proddatur in Kadapa district which is also called as Golden town has been struggling due to financial frauds since the last two years.
The ‘second Mumbai’ in bullion market has been affected due to malpractices in the market and genuine merchants are losing their business due to such frauds.
Since the last two years, financial frauds worth Rs 100 crores were placed in Proddatur bullion market. Five senior merchants and another six small merchants filed insolvency petitions (IP). Those who gave financial assistance to them are hurt.
There are 300 plus jewellery shops in Proddatur. Out of these, only 70 are registered under the GST Council.
A shop which shows constant business will get the permission from the GST Council. Since the last decade, most of the people have begun their business without getting permission from the authorities concerned.
Two years ago, Muni Swamy Jewellers in Main Bazaar filed an IP for Rs 15 crores. The money lenders recently approached Tirupati CID officers. The officers on May 7 broke the locks in presence of revenue officers and inquired about the assets and debts list.
A gold businessman from NS Complex filed an IP for Rs 17 crores and is absconding from town. Later, he suffered a heart attack and took treatment at Hyderabad, Kurnool and Kadapa RIMS. From then, no money lender pressured him for repaying the debt amount.
Another merchant from Kopparapu Subbaravu street filed an IP for Rs 10 crores and absconded from the town. The money lenders are worried about his disappearance.
Yet another merchant from Mokshagundam street made Rs 8 crores debts and filed an IP. Another six businessmen have allegedly committed financial frauds up to Rs 40 crores.
All these are unregistered insolvency petitions. Recently, in July 2019, a businessman filed IP for Rs 10 crores.
An imposter from Proddatur on May 2019 absconded with jewellery worth Rs 3 lakh stolen from a West Bengal based goldsmith Mithun Dulai. In another incident, three persons one Rajasekhar, Pullareddy and Prasad stole 1.08 kilograms gold from a Coimbatore merchant in Jayanthi Express in Chittoor District with the help of a Proddutur-based constable. These financial frauds have been shading the Proddatur bullion market.
Vice President of state gold and diamond merchants’ association B. Rammohan Rao urged the government to take steps to trade gold only for those who have legally obtained all permits. He demanded to make it statutory.
