Home Insolvency & Bankruptcy ED attaches Rs 367 crore worth properties of Bhushan Steel

ED attaches Rs 367 crore worth properties of Bhushan Steel

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ED attaches Rs 367 crore worth properties of Bhushan Steel

The Enforcement Directorate on Friday connected movable and immovable properties price Rs 367 crore of Bhushan Metal beneath the provisions of Prevention of Cash laundering Act (PMLA), 2002. The immovable properties have been located in Delhi, Mumbai, Kolkata and Odisha. The connected properties have been held within the identify of proxies or shell firms.

ED initiated investigations on the idea of prosecution criticism filed by Severe Fraud Investigation Workplace (SFIO) towards Bhushan Metal Restricted.

As per ED investigations, former managing director of Bhushan Metal Restricted (BSL) Neeraj Singal and associates fashioned a number of shell firms to flow into funds from one firm to a different via a community of a number of entities. The funds taken from banks as loans have been circulated to infuse capital, purchase property and for different private functions not meant by the Banks.

Investigations additionally revealed that promoters, administrators and the officers of BSL ready cast paperwork and made fraudulent representations earlier than the banks to low cost Letter of Credit (LCs) and diverted the funds again into their very own firms with malafide intentions.

Funds have been misappropriated towards the fabricated LCs created in favour of JSW Metal restricted and Hindustan Zinc Restricted. The misappropriated funds have been diverted to different group/related firms, inflicting wrongful loss to the State Financial institution of India and Punjab Nationwide Financial institution.

Earlier, ED had provisionally connected property price Rs 61.38 crore In November 2021 and a search operation was additionally performed on Neeraj Singal on ninth June 2023 and he was arrested by ED on the identical day. Neeraj Singal is at the moment in Judicial Custody.

Prosecution criticism was filed towards him and different accused individuals on 08 August 2023 and cognizance was taken by the PMLA court docket on 07 November 2023. One other search operation was performed on 13 October 2023 with respect to sure individuals of BSL who had a key position in financial institution fraud. Vital Digital proof and valuables have been seized through the search proceedings.

Thereafter, ED had arrested Ajay Mittal (brother-in-law of Neeraj Singal), Archana Mittal (sister of Neeraj Singal), Nittin Johri (the then CFO of Bhushan Metal), Prem Tewari (the then Vice President, Banking) and Prem Agarwal (the then Vice President, Accounts). Ajay Mittal and Archana Mittal acquired proceeds of crime to the extent of Rs 80 crore. Additionally they mortgaged property of BSL and routed the funds to the household of Neeraj Singal.

Presently, Archana Mittal is out on bail whereas all different accused individuals are in judicial custody.

Bhushan Metal was one of many first few massive NPA instances which have been referred to by Reserve Financial institution of India (RBI) for initiation of company insolvency decision course of (CIRP). Tata Metal emerged because the profitable decision applicant after it promised to pay Rs 36,000 crore to collectors of the Bhushan Metal towards their claims of Rs 43,832 crore.

Additionally See: NCLT can beneath Part 32A order launch of company debtor’s properties connected by ED

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