ED raids 11 locations in Maharashtra, Madhya Pradesh in ₹109-cr bank fraud case
The Enforcement Directorate (ED) has carried out searches in Maharashtra and Madhya Pradesh in connection with its money laundering investigation related to an alleged bank fraud case of ₹109.87 crore against a private firm and its directors.
The agency carried out searches at 11 locations in Akola in Maharashtra and Indore, Jaura and Mandsaur in Madhya Pradesh on Wednesday in the case involving Narayan Niryat India Pvt. Ltd and others associated with the firm. The search covered the business premises of the group companies of Narayan Niryat India and the residences of the directors of the companies, ED sources said.
“During the searches, various documents, books of accounts of the group companies and details of immovable and movable properties were found and seized,” ED sources said.
The ED started its investigation based on a case registered by the Central Bureau of Investigation against the firm and its directors. The investigation conducted by the agency has revealed that during the period of 2011 to 2013, the accused firm and its directors allegedly availed credit facility worth around Rs. 110.50 crores in the form of Letter of Credit (LC) and Export Packing Credit from a consortium of banks, comprising UCO Bank, Corporation Bank (now merged with the Union Bank of India) and Punjab National Bank.
A LC, issued by a bank, guarantees the buyer’s payment to the sellers. The company allegedly failed to repay the loan amounts to the tune of Rs. 109.87 crores, ED sources said.
The agency’s probe revealed that the company allegedly did not utilise the funds for the purpose for which those were sanctioned and submitted dubious books of account for availing the bank loan. It was revealed that the accused firm defrauded the banks and diverted the amounts availed through the credit facility to various associate companies, without transacting any goods.
The probe also found that part of the property mortgaged with the banks was allegedly sold to third parties without any intimation to the banks. The firm is therefore accused of involvement in the processes connected to the proceeds of crime as per the agency.