Enforcement Directorate charge-sheet against DPIL

The ED said on Thursday it has filed prosecution complaint against Vadodara-based Diamond Power Infrastructure Ltd. (DPIL) before the special Prevention of Money Laundering Act (PMLA) court) in an alleged bank fraud case of Rs2,654 crore. The agency also named DPIL directors Amit Bhatnagar, Sumit Bhatnagar, Suresh Bhatnagar, and 11 others in the complaint.

In the prosecution complaint, ED urged for the confiscation of attached assets under section 4 of Prevention of Money Laundering Act, as well as punishment for the Bhatnagars and other accused persons. ED had already attached immovable assets of DPIL, including windmills and an under-construction hotel, worth Rs1,122 crore on April 24. DPIL is accused of defrauding various banks to the tune of Rs2,654 crore. Investigations under PMLA were initiated on the basis of a case registered by CBI, Gandhinagar, against the firm and others for causing the loss to a consortium of 19 banks.

The investigation revealed that DPIL had availed term loans/working capital loans, external commercial borrowings and non-convertible debentures from the consortium. It was also found that DPIL had misused the facility of letters of credit issued by banks for payments of about Rs1,222.74 crore against fake/ paper purchases made from Archon Engicon, Accord Industries, Jindal Aluminium Foils, and Ruby Cables.

The investigation revealed that DPIL promoters had diverted Rs5.80 crore to their UAE based company Diamond Power Global Holding, and Rs44 crore to group company Northway Spaces. DPIL also diverted about $40,32,000 (approximately Rs21 crore) to group company Mayfair Leisures, through a series of UAE-based companies, ED said. ED sources said that when the banks conducted stock audits of DPIL, it was found that a large part of the stock of goods was missing from their premises. The total of such missing stock during 2008-2018 is about Rs453.54 crore. The investigation also showed that DPIL has shown excess sales of about Rs270 crore to PSUs like GETCO, Powergrid Corporation of India, PGVCL and DGVCL.

ED said that DPIL has shown false trade receivables to the tune of Rs384 crore in respect of 19 customers investigated so far.

Trade receivables, sales turnover and stock of goods are considered as important parameters by banks for grant of drawing power to the customer, i.e. DPIL. According to ED, by resorting to such unauthorized use of funds issued by the banks, DPIL has caused a loss of Rs2,654 crore to them. ED said that further investigation in the case is going on. The Bhatnagar trio was arrested by CBI in April. While Suresh was granted bail recently are still lodged at the Sabarmati central prison.

INSIDE THE CASE

The probing agency urged for the confiscation of attached assets under section 4 of Prevention of Money Laundering Act, as well as punishment for the Bhatnagars and other accused persons.