Maharashtra sugar mill sale case: ED attaches Rs 50.20 cr under PMLA

Mumbai (Maharashtra) [India], March 8 : The Enforcement Directorate (ED) Mumbai attached assets valued at Rs 50.20 crore under the provisions of the Prevention of Money Laundering (PMLA), 2002 in a case relating to the illegal sale of sugar mills by Maharashtra State Co-operative Bank (MSCB).
According to an official release, the assets attached by the central probe agency belong to M/s Kannad Sahakari Sakhar Karkhana Limited (Kannad SSK) owned by M/s Baramati Agro Ltd.
The attached assets consist of 161.30 acres of land, plant and machinery, as well as, the building of the sugar unit in Kannad, Dist- Aurangabad, it added.
ED initiated investigations on the basis of an FIR registered by the Economic Offence Wing, Mumbai Police under various sections of IPC and of Prevention of Corruption Act.
The said FIR has been registered in pursuance of the order dated August 22, 2019, of the Bombay High Court. In the said FIR, it has been alleged that the SSKs were fraudulently sold by the then officials and directors of MSCB at throw-away prices to their relatives/private persons without following the due procedure.
ED investigation revealed that to recover the outstanding loan of Rs 80.56 crore of M/s Kannad
SSK Limited, MSCB, took possession of all the assets of said SSK on July 13, 2009, under SARFAESI Act.
As per the release, on August 30, 2012, MSCB conducted an auction of Kannad SSK by fixing a very low reserve price based on a questionable valuation report. Apart from M/s Baramati Agro Ltd., 2 other parties entered into the bidding process.
The bidder with the highest bid was technically disqualified on flimsy ground, whereas the other
bidder was already a close business associate of M/s Baramati Agro Ltd. with no financial capacity or experience in running a sugar unit, the release added.
Based on the investigation conducted and evidence collected under PMLA so far, it has been
established that the acquisition of Kannad SSK by M/s Baramati Agro Ltd was illegal and assets so acquired are proceeds of crime under Section 2(i)(u) of the PMLA, 2002.
Accordingly, a provisional attachment order under PMLA was issued attaching all the assets Kannad SSK acquired for Rs 50.20 crore.
Earlier, in this case, three provisional attachment orders were issued where assets acquired at
Rs 121.47 crore has been attached.
The release said, "Further, one main prosecution complaint and two supplementary
prosecution complaints have also been filed before the Special PMLA Court, Mumbai for wrongful
acquisition of 3 other SSKs.
The Court has already taken cognizance of all the prosecution complaints filed in this case.
Further investigation is in on. More details are awaited.