Hyderabad: The Hyderabad regional unit of the Enforcement Directorate (ED) has provisionally attached land worth Rs 48.71 crore as a parcel and residential complex under the provisions of the Prevention of Money Laundering Act (PMLA)-2002 in a bank fraud case. An investigation is underway against Transstroy India Limited (TIL) and others. Former TDP MP Raipati Sambasiva Rao is one of the promoters, it is learnt.
The ED initiated the investigation based on an FIR registered by the CBI in Hyderabad under various sections of the Indian Penal Code (IPC) and the Prevention of Corruption Act-1988. TIL took loans and credit facilities from the consortium of banks but did not use the funds for the intended purpose.
These loan accounts turned into NPAs due to constant irregularities of the company, repeated transfer of letters of credit (LC), non-payment of interest on working capital limits and inability to operate through consortium banks.
Borrowed funds were channeled to its group companies, shell entities, promoters and directors owned/controlled entities and several unaffiliated entities.
The ED investigation found that TIL and its directors and promoters periodically availed loan facilities and spent funds fraudulently with the help of bogus sale and purchase transactions with their affiliates and shell entities by showing fictitious high turnover. Opening of Accommodated LCs led to liquidation of LCs and Rs. 5115 crore with interest to a consortium of banks.
Investigations revealed that the operators or promoters of TIL have created several shell entities to divert and layer the proceeds of crime by naming their employees and making them dummy directors. It has also been revealed that light motor vehicles and two-wheelers were included in fake invoices as vehicles for transporting steel in tonnes.
The ED investigation further revealed that around Rs 85.90 crore cash was withdrawn from the bank accounts of TIL and related entities and used by its promoters and directors for their personal gains. It has also been revealed that immovable properties derived from the proceeds of crime have been gifted to family members by law enforcement agencies to deter their pursuit.
The properties involved include land parcels gifted by one of the operators to his family members as well as residential premises of an entry provider involved in diversion of funds on commission basis. Further investigation is underway.