Mumbai: In a case related to a Rs 828-crore bank loan fraud, a Special Prevention of Money Laundering Act (PMLA) Court in Mumbai has given the go-ahead to restitution of the attached immovable properties valued at Rs 393.79 crore to the “bonafide legitimate claimants”, an ED official said on Thursday.
The ED’s Surat Sub Zonal Office secured the favourable order from the court on Tuesday in the matter involving Nakoda Limited and others, the ED said in a statement.
As per the facts of the case, the ED initiated the investigation under the Prevention of Money Laundering Act, 2002, against Nakoda Limited and others for their involvement in the generation and laundering of proceeds of crime.
The PMLA investigation revealed that Nakoda Limited — a company owned/controlled by Babulal Gumanmal Jain and Devendra Babulal Jain and others — defrauded a bank consortium of Rs 828 crore by systematic routing of funds through group entities, the ED added.
Investigation revealed that 13 banks’ consortium led by Canara Bank issued Letters of Credit (LCs) to Nakoda Limited’s vendors based on invoices submitted by them.
These LCs were later discounted by vendors using fake Bills of Exchange and invoices accepted by Nakoda Limited without actual supply of goods. Out of 1,212 LCs worth Rs 4,204.25 crore were opened in favour of Nakoda Limited’s vendors, 202 Inland LCs amounting to Rs 827.98 crore were devolved due to non-payment by the company.
During the investigation under PMLA, 2002, immovable properties worth Rs 375.71 crore were provisionally attached in 2018 and immovable properties worth Rs 18.08 crore in 2019, the ED said, adding that the attachments were subsequently confirmed by the adjudicating authority.
The central agency also filed a charge sheet and supplementary charge sheet in the matter before the Special PMLA Court in Mumbai against Nakoda Limited and others for the offence of money laundering, praying for the confiscation of properties attached as proceeds of crime, the ED said.
“In the matter, Corporate Insolvency Resolution Process (CIRP) was also initiated against Nakoda Limited by the National Company Law Tribunal (NCLT) at Ahmedabad. Upon failure of the resolution process, liquidation proceedings were commenced,” the ED said.
Subsequently, the liquidator filed an application before the Special PMLA Court at Mumbai seeking restoration of the attached property, the ED added.
Considering the intent of PMLA to restitute/restore the proceeds of crime to bonafide legitimate claimants, the ED submitted no objection before the Special PMLA Court at Mumbai for the release of property attached, the federal probe agency said.
Based on the aforesaid submission of the ED, the Special PMLA Court at Mumbai ordered the release of the attached immovable properties amounting to Rs 393.79 to the liquidator for further handing over to legitimate claimants, the ED added.
(IANS)
