ED questions Jayant Patil’s brother in connection with probe against a firm

The Enforcement Directorate (ED) has questioned the brother of former Maharashtra minister Jayant Patil in connection with a money-laundering investigation. The agency has been investigating alleged irregularities at Sangli's Rajarambapu Sahakari Bank and at Infrastructure Leasing and Financial Services (IL&FS). The ED had previously questioned Patil himself in May.

Mumbai: The Enforcement Directorate (ED) has recently questioned the brother of Jayant Patil, the former Maharashtra minister and Nationalist Congress Party’s (Sharad Pawar’s faction) state president, in connection with a money-laundering investigation involving a private firm.

Mumbai, India - June 09, 2023: NCP leader MLA Jayant Patil poses for the photos at his residence, in Mumbai, India, on Friday, June 09, 2023. (Photo by Satish Bate/ Hindustan Times) (Satish Bate/HT PHOTO)

The agency had served summons to Patil’s brother, who is a hotelier, and thereafter took details on the firm from him after the latter appeared before its investigating team a few days back, sources said.

Patil on Sunday, while talking to mediapersons, confirmed that the agency had served a notice to his brother. He added that four days ago, his brother had visited the ED office and submitted all the details he knew of in connection with the firm that is under the probe’s scanner.

The agency has taken several individuals and including those with political links, under its scanner in connection with two of its probes: one pertains to alleged irregularities linked to Sangli’s Rajarambapu Sahakari Bank Limited, a cooperative bank, while the other is connected to alleged financial irregularities at the debt-hit Infrastructure Leasing and Financial Services (IL&FS), sources said.

Earlier on May 22, Patil was questioned at the ED’s office in Mumbai for over eight hours to record his statement as part of its IL&FS investigation. The ED was verifying if Patil was allegedly a beneficiary, via his associate/s, of some proceeds of crime in the case, but he had dismissed all the allegations against him and said he had no links with the IL&FS case whatsoever.

After his questioning, Patil had told the media, “No payment came to my account, nor any payment went to anyone from my account. These are false allegations. I have replied to all the questions of the ED to their satisfaction. I was not asked about any payment from any subcontractor. I have no links with IL & FS at all.”

In June, the ED had carried out searches at around 16 locations in Sangli, including at the premises of Rajarambapu Sahakari Bank Limited, as part of its probe related to allegedly dubious sales tax refunds procured around 12 years ago by a few private firms which are under the scanner.

The agency has taken certain dubious withdrawals from the bank by the firms and it is verifying claims that a part of the funds was allegedly meant for individuals with political links, sources said.

The agency ‘s preliminary probe estimated that the extent of the dubious Value Added Tax (VAT) refunds withdrawn by suspected firms could be around ₹1,000 crore, sources said. A few private firms under the probe ‘s scanner had accounts in the cooperative bank.

The agency’s searches covered the premises of certain entities and persons suspected of having links with the case. The agency recovered several incriminating documents and records that are being scrutinised for evidentiary value.

Every reporting entity, including banks, are required to furnish to the Financial Intelligence Unit – India or the FIU - IND, that is under the Ministry of Finance, reporting about suspicious Cash Reporting Transactions and Suspicious Transaction Reporting.

It will be probed if the bank had complied with the reporting requirements, according to sources. The agency, which initiated its money-laundering probe a year ago, will examine lapses if there were any, the sources said.

The FIU-IND was set by the Government of India in November 2004 as the central national agency responsible for receiving, processing, analysing and disseminating information relating to suspect financial transactions.

Earlier in May, as part of its IL&FS case probe, the ED had conducted searches in Mumbai at five locations against two former IL&FS audit firms. The ED has taken under its scanner the books of accounts and financial statements from 2013-14 to 2017-18.

The ED’s probe in the IL&FS case had been initiated in February 2019 based on a Delhi Police Economic Offences Wing (EOW) case filed against IRL, ITNL (group companies of IL&FS), its officials and others.

The ED had also taken the cognisance of a complaint filed by the Serious Fraud Investigation Office against IL&FS Financial Services (IFIN) and its officials.

The agency alleged in the chargesheet that the senior management of IL&FS indulged in acts of commissions and omissions, leading to illegal personal gains to them at the expense of the company.

Despite attempts, HT could not reach Patil for his comments about the ED action.