Enforcement Directorate (ED) has provisionally attached assets worth ₹517.81 crore of SKS Ispat & Power Ltd in the form of land, building, plant and machinery in a bank fraud case against Tamil Nadu-based Cethar Limited.

ED initiated investigation based on an FIR registered by CBI’s Bank and Securities Fraud (BSF) Cell, Bangalore, against Cethar Limited, a boiler manufacturing company based in Trichy, Tamil Nadu. The company availed credit facilities to Rs 895.45 crore from a consortium of lenders led by Indian Bank, SAM Branch, Madurai. Cethar’s accounts turned NPA on December 31, 2012, and subsequently, proceedings under the Insolvency and Bankruptcy Code (IBC) were initiated before National Company Law Tribunal (NCLT), Chennai, in 2017.

After taking over the case under the PMLA in 2019, the ED carried out searches at the premises of a director of the company and immovable property and jewellery worth ₹9.08 crore were attached in 2022, which were subsequently confirmed by the Adjudicating Authority, PMLA, said the investigating agency. Further investigations pointed out that the ED revealed a whopping ₹565 crore that was kept off the books and ₹228 crore written off as a loss on the sale of investments.

“In order to be awarded the EPC contract of SKS Power Generation (Chhattishgarh) Limited (SKSPGCL) for about ₹3,500 crore, Cethar Ltd had siphoned off ₹228 crore to SKS Ispat & Power Ltd. under the guise of investment in shares of the then parent company SKS Ispat & Power Ltd,” the ED charged. However, theED revealed that the interest accruing @ 12% per annum compounded was kept off the book. This money was accounted as Trade Receivables until 2016-17, when it was written off as a loss on the sale of investments by creating backdated/forged agreements, informed the agency. It added that this was done just two days prior to the commencement of the NCLT proceeding, revealing a heightened degree of criminal conspiracy.

According to the ED, K Subburaj, Director of Cethar Ltd, allegedly conspired with Anil Gupta, CMD of SKS Ispat & Power Ltd., with criminal intent to siphon off assets of ₹793 crore from the books of Cethar, which turned insolvent, resulting in liquidation under the IBC, 2016. A convoluted scheme of agreements and transactions was created to conceal the proceeds of the crime of ₹793 crore which were safely parked at SKS Ispat & Power Ltd. SKS Ispat & Power Ltd. used the proceeds of crime of ₹793 crore for its regular business purpose, the agency stated.

Thus, the ED stated, fixed business assets of SKS Ispat & Power Ltd. in the form of land, building, plant and machinery along with roads and railway siding valued at ₹517.81 crore in its books are provisionally attached under the provisions of PMLA, 2002.

ED arrests Supertech’s CMD Arora

In another case, the ED Tuesday arrested real estate company Supertech’s CMD RK Arora more than two months after provisionally attaching 25 immovable properties valued at ₹40.39 crore.

The assets belonged to the Supertech Group of companies and their Directors in Uttarakhand and Uttar Pradesh under the provisions of the Prevention of Money Laundering Act. ED officials stated that Arora was arrested after he was grilled more than once over charges of siphoning off people’s money who had booked houses in properties of Supertech Group. He was produced before a designated court here in the national capital for seeking custody.

Buyers from Delhi, Uttar Pradesh and Haryana have filed over 20 FIRs against Arora. In April,

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