india

Updated: Oct 13, 2019 02:44 IST

In one of the biggest single-day attachments, the Enforcement Directorate (ED) has attached a Bhushan Power and Steel Ltd (BPSL) plant estimated to be worth Rs 4,025 crore, officials familiar with the development said on condition of anonymity. The ED is probing a money laundering case against the company and its promoters, Sanjay Singal and Aarti Singal.

One of the officials cited above said that the land, building, and machinery of the plant at Thelkoloi in Odisha’s Sambalpur was attached under the Prevention of Money Laundering Act (PMLA) on Thursday.

The officials said that the property was attached as there was a likelihood that it may change hands or the accused may create a third party interest in it.

They added that the BPSL and its promoters were allegedly involved in money laundering after taking bank loans. The money laundering probe is based on a First Information Report (FIR) the Central Bureau of Investigation (CBI) registered in April.

According to the FIR, the BPSL allegedly fraudulently diverted approximately Rs 2,348 crore loaned from the Punjab National Bank (PNB), Oriental Bank of Commerce, IDBI Bank and UCO Bank also into the accounts of shell companies “without any obvious purpose” through its directors and staff, and thereby misused the funds.

“... the company availed various loan facilities from 33 banks/financial institutions during the year 2007 to 2014 to the tune of Rs 47,204 crore (approx) and defaulted on repayments. Subsequently, lead bank PNB declared the account as NPA [non-performing asset] followed by other banks and financial institutions,” the CBI said in April.

The CBI added that the accused entered into a criminal conspiracy among themselves and with unknown public servants of banks and others to allegedly cheat the banks. “In furtherance of the said criminal conspiracy, the accused dishonestly and fraudulently diverted huge amount of bank funds through companies/ shell companies/entities etc and deliberately defaulted in repayment and also claimed inadmissible CENVAT [Central Value Added Tax.credit] etc,” the CBI added.

The CBI accused the company of using the bank funds for the purpose other than sanctioned by the bank by “committing forgery for the purpose of cheating, used forged documents and falsified the accounts causing loss to the tune of Rs 2348 crore (approx) to the lending banks”.

Bhushan Steel Ltd’s lawyer (NAME) refused to comment on the attachment.

Sanjay Singal’s brother, Neeraj Singal, and father, Brij Bhushan Singal, earlier headed the company.

The Serious Fraud Investigation Office in June filed a charge sheet against Brij Bhushan Singal and Neeraj Singal alleging they ran over 150 shell companies and made payments in cash. It arrested Neeraj Singhal in August and his father filed an anticipatory bail plea in the Delhi high court last month.

Bhushan Steel Ltd was acquired by Tata Steel in May 2018 and has since been named as Tata Steel BSL.