ED claims irregularities in BPSL consignments after RP took charge

Steel company clandestinely moved finished goods from its Odisha factory to its plants in Kolkata and Chandigarh, says agency

The Enforcement Directorate (ED), which is probing money laundering charges against Bhushan Power & Steel (BPSL), has found that irregularities continued in clearances of consignments worth Rs 700 crore by the erstwhile management of the debt-ridden company even after the insolvency process was initiated under its resolution professional (RP) M K Khandelwal. 

The probe agency suspects connivance of the outgoing BSPL management with the RP. On Wednesday, the federal agency had carried out an extensive search operation at four premises belonging to the RP and a former director of the debt-ridden steel company.

During these searches various incriminating documents, laptops, mobile phones and other valuables such as jewellery worth Rs 86 lakh were seized. 

According to ED, incriminating documents indicating receipt of cash by Khandelwal while discharging duties of Interim Resolution Professional (IRP) have also been seized. Huge cash payments to various individuals outside the books of accounts indicate siphoning of funds, ED sources said. 

Despite repeated attempts by Business Standard, Khandelwal could not be contacted as his phone remained switched off.  Explaining the findings, an ED official said that the steel company had engaged in clandestine removal of finished goods from its Odisha plant to its plants at Kolkata and Chandigarh. Further probe in the matter revealed that 59 consignments valued at around Rs 700 crore were cleared without payment of applicable taxes and duties and without issuance of any statutory invoice. All this happened with the involvement of the RP. 

Earlier investigation revealed that Sanjay Singal, former managing director of BPSL and others illegally diverted huge amount of funds from the loans taken by BPSL from various banks. 

These funds were used for creation of assets (including equity investment in BPSL and movable/immovable properties in Delhi and London) in the name of companies controlled by Singal. 

So far, assets totalling Rs 4229.54 crore have been identified and provisionally attached under the Prevention of Money laundering Act. Prosecution complaints have also been filed against 25 accused under the PMLA.

The BPSL case is in the final leg of hearing in the Supreme Court.