Former Jaypee chief held in ₹14,599-cr money laundering case; in ED custody for 5 days

Later in the day, Gaur was produced before additional sessions judge Dhirendra Rana at Patiala House Courts, where ED sought seven days’ custody for further interrogation.

The Enforcement Directorate (ED) on Thursday arrested Manoj Gaur, former executive chairman and CEO of Jaiprakash Associates Ltd (JAL) and former managing director of Jaypee Infratech Ltd (JIL), in a ₹14,599-crore money laundering probe linked to alleged large-scale diversion of homebuyers’ funds within the Jaypee Group. He was arrested under Section 19 of the Prevention of Money Laundering Act (PMLA) after what officials described as months of “detailed investigation and analysis of evidence”.

The arrest follows ED search operations conducted on May 23 at 15 locations across Delhi, Noida, Ghaziabad and Mumba (File photo)

Later in the day, Gaur was produced before additional sessions judge Dhirendra Rana at Patiala House Courts, where ED sought seven days’ custody for further interrogation. The court granted the agency five days’ custody after hearing arguments from both sides.

A senior ED official said the probe began after multiple FIRs were filed with the economic offences wings of the Delhi and Uttar Pradesh Police, based on complaints from homebuyers of the Jaypee Wishtown and Jaypee Greens projects alleging criminal conspiracy, cheating and criminal breach of trust. “Thousands of homebuyers paid advances for apartments that were never completed, while their money was allegedly routed elsewhere,” the official said.

According to ED, JAL and JIL collected roughly ₹14,599 crore from homebuyers — as per figures admitted before the National Company Law Tribunal (NCLT) — and “a substantial portion” of this was diverted to group entities and associated trusts, including Jaypee Sewa Sansthan (JSS), Jaypee Healthcare Ltd (JHL) and Jaypee Sports International Ltd (JSIL). ED alleged that Gaur, who serves as managing trustee of JSS, oversaw transactions forming part of a “complex web” used to siphon funds for non-construction purposes.

The arrest follows ED search operations conducted on May 23 at 15 locations across Delhi, Noida, Ghaziabad and Mumbai, during which officials seized large volumes of financial and digital records that the agency says directly indicate laundering and diversion of funds.

During the proceedings at Patiala House Courts, ED counsel Atul Tripathi said that JAL and JIL had collected over ₹33,000 crore from homebuyers for the construction and completion of residential projects in Jaypee Wishtown and Jaypee Greens in Noida and Greater Noida, respectively, but around ₹13,000 crore was diverted. “We found several transactions where your (Gaur’s) involvement was found. We are duty-bound to investigate. He is one of the key people in all the companies,” Tripathi said, adding that custody was required to confront him with documents and trace the fund flow.

Gaur’s counsel, advocate Farukh Khan, opposed the remand plea, saying his client had cooperated throughout, submitted documents, and answered all questions. He told the court that Gaur, 61, suffers from diabetes and asthma, and that his statements regarding several allegations had already been recorded by ED in 2021. Khan questioned the timing of the arrest, noting that the ECIR was registered in 2018.

ED reiterated that its probe has established Gaur’s central role in the alleged diversion of funds. “Out of approximately ₹14,599 crore collected by JAL and JIL, substantial amounts were diverted for non-construction purposes and siphoned off to related group entities and trusts,” the agency said in its written submissions.

ED added that the investigation into the Jaypee Group was ongoing and that further questioning of Gaur was necessary to identify additional beneficiaries and track the full money trail.

The judge allowed five days’ custody, observing that the agency must be given reasonable opportunity to pursue unanswered questions in what it described as a complex, multi-entity financial investigation.

(with inputs from PTI)