Diversion of cash collection in company to individual account for meeting expenses

It may depend on circumstances and facts in the case, paying salaries or wages to the workforce may not amount to the diversification of funds according to my knowledge.  If the amounts are diverted to personal use and to deprive the lender, with an intention to cheat him then that may amount to illegality.  If the employee is from HRD and when the amount transferred was wages/salaries with strict instructions as such,  company may have to pass such resolutions specifying the name of the person, purpose, on dealing of such funds and controls.  Generally, when a company is a defaulter in one bank, the other bank may not accept to open such accounts.  (To be honest, I am not able to understand the need for opening the account with a bank only for the purpose of payment of wages/salaries whereas the cash can be entrusted to Accounts officer for disbursement of salaries, I presume the account is needed for encashing the cheques received by the company, and I do not know how a bank can credit the proceeds of a cheque in the name of company to a personal account of employee)

It is wrong manner..... You said it is under NPA ? what action taken by bank?  Hope your company has legal adviser... better to discuss with them and follow