November 23, 2019

ED Arrests Bhushan Power & Steel Ltd’s Former CMD Sanjay Singhal In Connection With Money Laundering Probe

[ By Bobby Anthony ]


The Enforcement Directorate (ED) has arrested former Chairman and Managing Director of Bhushan Power & Steel Limited (BPSL) Sanjay Singhal in connection with an ongoing money laundering probe against him.

Singhal was arrested under the charges of Prevention of Money Laundering Act, the ED has stated, adding that he had not been co-operating with the ED during questioning.

Singhal will be produced before a court in New Delhi shortly to seek further custody, the ED has stated.

It may be recalled that recently, the ED had attached assets worth Rs 4,025 crore belonging to Bhushan Power and Steel Ltd (BPSL).

Earlier, the ED had stated that an amount of Rs 695.14 crore was introduced as capital by Singhal who was then CMD of the company and his family members in BPSL, out of artificially generated long-term capital gains by diversion of bank loans.

In an earlier probe report, the ED had stated that then BPSL chairman Sanjay Singhal had devised a “brilliant scheme to dress up the books of accounts” of the company.

“BPSL had devised a peculiar modus operandi to siphon funds obtained as loans from various banks and financial institutions. The Singhals did not use the bank funds for the purpose for which they were sanctioned. Forgery was committed forgery and accounts were falsified, causing wrongful loss to lending banks,” according to the ED report.

In July, Punjab National Bank and Allahabad Bank had accused BPSL’s former promoters and directors of fraud in connection with loans given to the company.

The ED had stated that during his questioning on October 3, Singhal had admitted to routing the amounts transferred by BPSL to various parties on account of purchase of goods, which never took place.

Singhal deposed in his statement to the ED that Rs 3,330 crore was routed to the accounts of four companies controlled by him out of the funds diverted from the accounts of BPSL in the shape of advances shown to various parties.

The ED had also stated that Singhal conceded that the four companies – Jasmine Steel Trading, Marsh Steel, Diyajyoti Steel and Vision Steel – were promoters of BPSL which were ultimately owned and controlled by him and his family.

Allegedly, the four companies infused Rs 3,330 crore in BPSL in the period from 2011-12 to 2016-17.

However, BPSL denied all allegations leveled against it.

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