The Enforcement Directorate (ED) has attached assets worth Rs 263 crore, including land and bank accounts of the Hyderabad-based Deccan Chronicle group, in connection with a money laundering case related to a bank fraud.
The agency said it has issued a provisional order for attaching "movable and immovable assets in the form of land, residential properties, shares, bank balance, foreign currency receivables and luxurious cars in a bank loan fraud case pertaining to Ms Deccan Chronicle Holdings Limited (DCHL), Hyderabad for causing a total loss of Rs 1,161.93 crore to six public sector banks
"The banks are Canara Bank, Andhra Bank, Indian Overseas Bank, Central Bank of India, Corporation Bank and IDBI Bank," it said.
The Enforcement Directorate had booked a case under the Prevention of Money Laundering Act (PMLA) against the company and others based on a CBI FIR and chargesheet.
The agency said its investigation "revealed that DCHL had availed loans for working capital, purchase of capital goods and short-term loans by overstating the receivables, understating huge loan liabilities by furnishing fabricated financial statements and not disclosing the loans taken from other banks and non-banking financial companies.
"In total, DCHL availed 111 loans amounting to Rs 10,000 crore from 16 different banks between 2004-2012. Out of such loans, an amount of Rs 2,800 crore is outstanding to various banks as on September 30, 2012 excluding interest," it said.
The agency alleged, "Such loan amounts were used for other than the specified purposes such as investing in 20 group companies or firms, acquiring companies with huge premiums, payments to Airbus towards purchase of cargo aircrafts, payments to BCCI for Indian Premier League franchisee of Deccan Chargers, payments towards dividends declared by Ms DCHL, buy-back of shares, issue of bonus shares, purchase of luxurious cars in the name of associates/group companies, repayment of earlier loans taken, among others."
The group companies of DCHL, it said, acquired movable and immovable properties with the loan received from Ms DCHL and did not disclose the same in the audited balance sheet of the companies concerned with a view to obscuring the identity of such properties which amounted to money laundering.
"Investigation also revealed that the loan funds used for purchase of retail franchisee by name 'Odyssey' were received back by the promoters at a later date.
"To show a rosy picture in the eyes of investors/banks, DCHL had declared dividends, issued bonus shares, bought back shares by investing an amount of around Rs 230 crore and the promoters of DCHL also received Rs 143 crore as dividends by using loan proceeds which later became non performing assets to banks," it said.
The agency said the properties attached under its order
today are other than the properties pledged to banks, NBFCs by DCHL, which are under attachment or taken over under SARFAESI Act or Debts Recovery Tribunal (DRT) proceedings.
"Further investigation is under progress," it added.
The attachment of assets under PMLA is aimed at depriving the accused of taking benefits of their ill-gotten wealth and such an order gets confirmed after a directive is passed by the Adjudicating Authority of the said Act within 180 days.
