New Delhi: The Enforcement Directorate (ED) has provisionally attached assets of REI Agro Limited worth Rs 481 crore under Prevention of Money Laundering Act, 2002 (PMLA) in connection with a bank fraud case.
The attached properties include land building plant, machinery of the rice mill unit of REI Agro, office space held by controlled companies, wind farms and fifty per cent share of the immovable properties held by four companies of Fortune Group based in Kolkata.
The properties have been attached in connection with a case registered by the Central Bureau of Investigation (CBI) in 2015 alleging that the directors of the company – Sandip Jhunjhunwala, Sanjay Jhunjhunwala and others – availed various credit facilities or limits from various banks under consortium arrangement including UCO Bank flagship corporate branch, according to a statement issued by the ED on Thursday.
They are also accused of defrauding banks from 2013 onwards to the tune of Rs 3,872 crore by fraudulently diverting funds, the agency added.
Investigation showed that REI Agro Ltd and its directors diverted funds sanctioned as working capital loans by 14 banks under the consortium led by UCO Bank using different modus including trading in bogus/fake bills.
The directors also diverted funds by investing in Varrsana Ispat Pvt Ltd directly and through controlled companies, setting higher amount of Capex advances given to various shell companies by arbitration at a very low amount, showing higher cost of construction and arranging fake purchase/sale bills, etc, the ED said in its statement.
The investigation showed that Sandip Jhunjhunwala was engaged in arranging false purchase/sales of invoices of rice and paddy through brokers/dealers of Delhi for availing maximum working capital limits from the consortium banks and diverted working limits for capital expenditure.
“He has also illegitimately diverted funds to the tune of Rs 600 crore through Kolkata-based shell companies to the accounts of associate companies or companies controlled by him using banking channels. Later on, around Rs 300 crore of that money was settled through arbitration against taking over of land valued around Rs 22 crore,” the ED said.
“Accused had also arranged fake bills of iron and steel to the tune of Rs 25 crore and shown it as capital expenditure but received back this amount in cash,” the agency claimed.
Earlier, the ED had provisionally attached properties of REI Agro Ltd in the form of land located at Sonipat district of Haryana, machinery and equipment of Varrsana Ispat Pvt Ltd, land and buildings located at Kutch, Gujarat, etc totalling to around Rs 511 crore.