It is alleged that loans, amounting to crores of rupees meant for construction of his ambitious township project, were siphoned off.

Hilal Rather was taken into custody by the ACB here in a case related to the alleged misappropriation of crores from term loans running into Rs 177 crore sanctioned by the Jammu and Kashmir Bank for his Paradise Avenue project at Narwal Bala here in 2012.

As per a statement issued by the ACB, its investigation revealed that Paradise Avenue, a partnership concern of Hilal Rather, Rizwan Raheem Dar of Srinagar, Ghulam Mohd Bhatt of Baramulla, and Daljeet Wadhera and Deepshikha Jamwal of Jammu, was sanctioned a term loan of Rs 74.27 crore in the first phase.

This was done by relaxing the credit policy of the bank, which restricts loan to a partnership firm at Rs 40 crore. The loan was approved by the board of directors of J&K Bank despite the fact that Hilal Rather had already entered into a one-time settlement (OTS) with the State Financial Corporation in the past.

The remaining loan amount was granted by the bank's board despite the fact that repayments of the first loan taken were not complete.

The statement further said that Hilal Rather, who also owns Simula Group of Companies, was being questioned for the last few months by the ACB in connection with siphoning off crores of rupees from the loan amount sanctioned by the New University Campus Branch of J&K Bank in Jammu for the construction of flats under the name of Paradise Avenue.

"Hilal Rather has been evading details of property raised and other transactions related to siphoning off funds meant for construction. He has been taken into custody for further questioning," the ACB said.

It also revealed that the funds diverted have been used to purchase huge properties abroad, holidaying abroad with family and friends and also for other entertainment activities.

All the loan amounts availed by Hilal Rather to tune of Rs 177 crore have become non-performing assets (NPAs), the ACB said, adding that further probe is on.