Kolkata: The Enforcement Directorate (ED) has attached movable and immovable properties of Bhushan Steel amounting to about Rs. 367 crore spread over four areas of Delhi, Mumbai, Kolkata, and Odisha, official sources has said.
The attachment was done on March 6 under the provisions of the Prevention of Money Laundering Act (PMLA).
"The attached properties were held in the name of benamidars/ shell entities through dummy directors to conceal the assets and ensure that they are out of reach of law enforcement agencies," the ED said in a statement.
The federal agency began investigation based on a prosecution complaint filed by Serious Fraud Investigation Office (SFIO) against Bhushan Steel Limited.
The agency probe revealed that erstwhile Bhushan Steel Limited and its Managing Director, namely Neeraj Singal and associates formed several shell companies. They rotated funds from one company to another through a chain of multiple entities. The funds were allegedly circulated to infuse capital, buy property, and for other personal purposes not intended by the banks.
Investigation further revealed that promoters/Directors and the officials of BSL prepared forged documents and made fraudulent representations before the banks to discount Letter of Credits (LCs) and diverted the funds back into their own companies with malafide intentions, the agency said.
"Funds were misappropriated against the fabricated LCs created in favour of JSW Steel Limited and Hindustan Zinc Limited. The misappropriated funds were diverted to other group/associated companies, causing wrongful loss to the State Bank of India and Punjab National Bank."
Earlier, the ED had attached assets worth Rs. 61.38 crore on November 8,2021 and a search operation was also conducted on Neeraj Singal on June 9, 2023 and he was arrested by ED on the same day.
Neeraj Singal is currently in Judicial Custody. A prosecution complaint was filed against him and other accused persons on August 8, 2023 and cognizance was taken by the PMLA court on November 7, 2023.
Another search operation was conducted on September 13, 2023, concerning certain persons of BSL who had a key role in Bank Fraud. Important Digital evidences and valuables were seized during the search proceedings.
The ED also arrested Ajay Mittal (brother-in-law of Neeraj Singal), Archana Mittal (sister of Neeraj Singal), Nittin Johri (the then CFO of Bhushan Steel), Prem Tewari (the then Vice President, Banking) and Prem Agarwal (the then Vice President, Accounts). "
"Ajay Mittal and Archana Mittal knowingly received proceeds of crime to the extent of Rs.80 crore. They also mortgaged the property of BSL and routed the funds to the family of Neeraj Singal. Currently, Archana Mittal has been granted bail by the Court while all other accused persons are in judicial custody.