PMLA court takes cognisance of ₹4,957-Cr bank fraud case against 34

The court on Monday summoned all 34 accused to appear on October 21 and said the material before it showed a “consistent and systematic course of conduct” involving the alleged siphoning of money from a consortium of the 17 banks led by Bank of Baroda

MUMBAI: A special PMLA court found prima facie evidence of money laundering in the alleged ₹4,957.31-crore bank fraud as it took cognisance against Pratibha Industries Ltd and 33 others, saying funds obtained from a consortium of 17 banks were allegedly siphoned through manipulated transactions, layered through entities and eventually used to acquire properties.

PMLA court takes cognisance of ₹4,957-Cr bank fraud case against 34. (Shutterstock)

The court on Monday summoned all 34 accused to appear on October 21 and said the material before it showed a “consistent and systematic course of conduct” involving the alleged siphoning of money from a consortium of the 17 banks led by Bank of Baroda.

The case began with a CBI FIR registered in January 2023 following a complaint by Bank of Baroda. The CBI had alleged that Pratibha Industries and its directors diverted funds to related parties and subsidiaries, used fictitious sale and purchase transactions to inflate turnover and allegedly inflated work-in-progress to secure credit facilities.

The company’s account had been classified as a non-performing asset on December 31, 2017, before the consortium banks subsequently declared it fraudulent.

The ED, which later investigated the money-laundering angle, alleged that the promoters used accommodation-entry providers and bogus entities to layer the diverted funds. Suspicious third-party transactions were allegedly used to channel money towards companies that purchased immovable properties.

According to the court order, Pratibha Industries had initially obtained a bank limit of ₹1,331.15 crore from the consortium. But as the company faced liquidity problems, it allegedly turned to fraud to stay afloat, issuing false letters of credit and bank guarantees to shell companies backed by fake purchase orders and invoices. The transactions, the court noted, allegedly took place without any actual movement of goods.

The court said the alleged transactions resulted in the consortium being defrauded of ₹4,957.31 crore.

The court also rejected the plea of Sunil Jugalkishor Anandpara and Dhwaja Commodity Services Pvt Ltd seeking to be dropped from the case. It found prima facie material that Dhwaja had received ₹5.10 crore from Pratibha Industries through allegedly manipulated invoices shown as rental commission. While, Anandpara was at the helm of the company’s daily affairs, the court noted.

The court said the material indicated that sale and purchase documents had allegedly been manipulated despite there being no movement of goods, with the diverted funds then used to acquire movable and immovable properties.

It concluded that there was prima facie material showing the generation, concealment, possession, acquisition and use of proceeds of crime, and held that there was sufficient ground to proceed against all 34 accused for money laundering.