NEW DELHI: In another significant action, Enforcement Directorate (ED) on Saturday said it restituted properties worth Rs 4,025 crore to JSW, a successful resolution applicant of the erstwhile Bhushan Power and Steel Ltd, under corporate insolvency resolution process of Insolvency and Bankruptcy Code.
The assets were attached by ED in 2019 after a money laundering probe revealed that the erstwhile promoters of Bhushan Power and Steel Ltd (BPSL) cheated banks and siphoned off funds to the tune of Rs 47,204 crore for private investments. A PMLA case was based on an FIR registered by CBI.
“The accounts were fudged to show fake expenses/purchases/capital assets, and thereby, bank funds were taken out in the form of cash. The cash was brought into the books of various beneficially owned companies (held through employees/dummy directors), and the same, was utilised for investments in the form of shares and immovable properties,” ED said.
The agency said after establishing money trail of the laundered proceeds of crime, it attached properties, including land, building and machinery, worth Rs 4,025 crore. Promoter Sanjay Singal was arrested on Nov 22, 2019, and a chargesheet was filed against him and the company in Jan 2020. A special court had taken cognisance of the case immediately, but trial is still pending for more than four years due to repeated adjournments sought by the accused.
Further, ED attached assets worth Rs 427 crore held by various shell companies linked to the accused.
A supplementary chargesheet is likely to be filed by the agency soon to begin the process of restitution of the remaining assets. The creditor banks had initiated corporate resolution under Insolvency and Bankruptcy Code, and JSW was the applicant seeking assets for an amount of about Rs 19,350 crore, as against the outstanding loans of Rs 47,204 crore.
Through an affidavit filed before Supreme Court, ED urged the apex court that it may direct handing over the attached assets to JSW and consider the same as restitution under PMLA. SC accepted the ED affidavit, and on Dec 11, ordered restitution of assets to JSW.