E-Paper
ED restores assets worth ₹52 crore in Shakti Bhog Foods money laundering probe
The ED probe is based on a CBI case from 2021, wherein it is alleged that directors allegedly falsified accounts and forged documents to siphon off public funds.
The Enforcement Directorate (ED) has restituted assets worth ₹52.35 crore in its money laundering probe against Shakti Bhog Foods Limited (SBFL) and its directors, who have been accused of cheating a consortium of 10 banks led by the State Bank of India of ₹3,269 crore.
The ED probe is based on a case by the Central Bureau of Investigation (CBI) from 2021, wherein it is alleged that directors allegedly falsified accounts and forged documents to siphon off public funds.
A statement issued by ED on late Wednesday evening said that it has so far attached assets worth ₹131 crore and filed six charge sheets in the case.
The company has gone into liquidation and the liquidator appointed by National Company Law Tribunal on behalf of committee of creditors (CoC), including the lender banks, had filed an application before the court for restoration of certain movable and immovable properties attached by ED.
“In accordance with the intent of restoring the proceeds of crime (POC) to legitimate claimants and victims of the offence of money laundering, ED consented for restoration of the certain attached properties,” ED said.
Thus, it said, immovable and movable properties valued at ₹52.35 crore (estimated market value of more than ₹120 crore) was restored to the liquidator representing CoC.
The federal agency has previously restituted properties worth over ₹25,000 crore to private victims or banks in various money laundering cases, including investigations against Nirav Modi, Mehul Choksi, and Vijay Mallya.
Shakti Bhog, which was engaged in the business of manufacturing wheat flour, pulses, rice etc, had availed credit facilities from consortium banks which, the ED said, were diverted to various dummy entities and sister concerns of SBFL without any actual business.
“Such bogus transactions with dummy entities were executed on the basis of fake bills and transport documents projecting these transactions as genuine business transactions. In such a process, several shell entities were used to divert, rotate and siphon off loan funds availed by SBFL,” the statement said.
The agency said it has identified 108 such dummy entities used for diversion of funds and were controlled and managed by entry operators, who used to charge commission for providing accommodation entries through these dummy entities.
“While rotating funds through the dummy entities or shell companies, loan funds were also siphoned off in the form of cash, commission payments and trade discounts etc. to these and various other dummy entities. In addition, some part of loan funds availed by SBFL were transferred into these dummy entities and thereafter these funds were transferred into bank accounts of SBFL, its directors, promoters and various third parties without any actual business,” it said.
The agency further said this shows intentional, deliberate and calculated siphoning of the borrowed funds by SBFL and other associated persons. “These funds were utilized to purchase properties and other assets projecting proceeds of crime as untainted,” the agency added.
