Nagpur/New Delhi: In a major regulatory crackdown, the Government of India has barred Nagpur’s Nirmal Ujjwal Credit Cooperative Society Ltd. from accepting fresh deposits or renewing existing ones after serious allegations of financial irregularities and fund diversion surfaced during an ongoing probe.
The order, issued by the Central Registrar of Cooperative Societies under the Ministry of Cooperation, follows findings from a Special Investigation Team (SIT), which pointed to prima facie involvement of key office bearers in siphoning off funds and misusing depositors’ money.
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As per official communication dated April 23, 2026, the Nagpur-based society has been strictly prohibited from mobilising any new funds from members or investors until further orders. The directive came after a hearing held on April 24, where senior representatives of the society appeared via video conference.
Investigators have flagged a pattern of questionable financial transactions. Loans were allegedly sanctioned in the names of staff members and subsequently routed to a private entity identified as PNG Corporation, reportedly linked to the society’s own office bearers. In another glaring violation, a firm named Nirmal Food Product, also associated with insiders, was granted membership and extended loans, raising serious concerns over conflict of interest.
The probe further revealed that substantial loan amounts disbursed between 2020 and 2025 remain unpaid, while a high-value loan granted to a former Secretary saw little to no recovery action. Additionally, the society failed to submit mandatory annual returns for multiple financial years, violating provisions of the Multi-State Co-operative Societies Act, 2002.
Although the society denied all allegations in its written reply, authorities noted that no credible documentary evidence was provided to support its claims. During the hearing, however, representatives admitted to granting loans to entities like PNG Corporation, an act deemed illegal under cooperative norms.
Officials said the findings point to “serious financial impropriety, diversion of funds, and regulatory non-compliance,” prompting immediate restrictions to safeguard depositors’ interests. The SIT investigation is ongoing and is expected to delve deeper into the alleged nexus and financial trail.
The action has sent shockwaves among depositors in Nagpur, many of whom now face uncertainty over their investments, as authorities move to uncover the full extent of the suspected scam.
