An internal enquiry by Bank of Baroda (BoB) in freezing the accounts of a marginal farmer in Uttar Pradesh for being a `guarantor` to the Rs 550 crore loan it gave to tycoon Vijay Mallya revealed that the state-run bank had mistaken the farmer to be the real guarantor, who goes by the same name.

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Investigation by leading news portal `FirstPost` found how casual the country`s second largest public sector bank was in lending and recovering loans doled out to corporates like Mallya`s defunct Kingfisher Airlines Ltd.

Though the bank tried to cover up its blunder of mistaken identity as a `technical error`, the inquiry found how the bank failed to be commercially prudent while lending to Mallya`s airline.

As reported by FirstPost on Thursday, the bank on December 15, 2015 froze the twin accounts of Manmohan Singh, a 52-year-old farmer of Khajuria Naviram village in Pilibhit district of Uttar Pradesh, who had taken a Rs 4 lakh crop loan from its rural branch at Nand, for being a `guarantor` for the Rs 550 crore loan Mallya raised to fund his airline.

"We had never ever heard the name Vijay Mallya before that. After running around the bank branch for six months, we had to go to the media for help. Within a week of the news hitting national headlines, our accounts were re-activated (May 26, 2016)," Manmohan`s younger son Harvindar, 22, told FirstPost.

As the news of a marginal farmer`s accounts being frozen for being a `guarantor` to Mallya`s loan spread, the bank admitted to the inadvertent mistake.

In the course of investigation, FirstPost found in Manmohan`s house a letter from the bank`s Nariman Point office to its concerned branches, in which nine persons were listed with their names, account numbers, location of accounts and balance therein as directors/guarantors of the loan.

"The first four were Vijay Mallya and three of his relatives. `Manmohan` figured fifth on the list. While all the Mallyas have their accounts in Mumbai, Bengaluru or Vadodara, Manmohan is the only one off the grid," the portal reported.

When asked how a small farmer from a Pilibhit village could be a `guarantor` for Mallya, one of the bank`s officers said that action was taken against Manmohan not as a `guarantor` but as a director` (of Kingfisher Airlines).

When the national media reported that Manmohan became `guarantor` due to a technical glitch, the bank clarified that Manmohan was wrongly proceeded against, but did not dispel the public perception that he was actually penalised for being a `director` on the Kingfisher board.

A look at the Kingfisher board of directors list, filed with the Registrar of Companies (RoC), revealed that among the seven directors, including Mallya, was `Manmohan Singh Kapur`, a well-known name in banking circles, for his stint as chairman of the state-run Vijaya Bank from August 2002 to March 2006. He is also on the boards of other firms and lives in Mumbai.

To a questionnaire by FirstPost, the bank`s corporate office admitted that the technical error occurred because of the "similarity of names".

Though Manmohan`s `directorship` on the Kingfisher board ended in over five months, freezing farmer Manmohan`s accounts left many questions unanswered.