Union Bank of India declares IL&FS Tamil Nadu Power Company as fraud for diversion of funds

State-owned Union Bank of India on Wednesday said it has declared IL&FS Tamil Nadu Power Company as a fraud account for diversion of funds, involving Rs 1,315 crore. "We wish to inform you that the account of IL&FS Tamil Nadu Power Company Ltd with the bank has been classified as fraud, reason being, diversion of funds by the company," the bank said in a regulatory filing.

The amount outstanding in the account is Rs 1,314.85 crore and provision already held is Rs 525.95 crore, it said.

The bank will initiate the appropriate legal proceedings in this regard in due course of time, it added.