Hyderabad: The Directorate of Enforcement, Chennai, has attached the properties of Viceroy Hotels Limited, Hyderabad, totally valued at Rs 315.50 crore, under the Prevention of Money Laundering Act.
The facts of the case are that directors Meka Ramakrishna Varma and B Narayanaswamy had taken over the management of BCEPL in 2010 by acquiring 100 shares in the company.
On record, the company is an engineering procurement and construction contractor, mainly concentrating on railway electrification, transmission and high voltage, for government and public sector undertakings.
There were three criminal cases against BCEPL and its key officials in 2018, including one registered by the Central Bureau of Intelligence, Bengaluru.
The cases were booked under Section 120-B r/w, 420, 468 and 471 of the Indian Penal Code, for hatching a criminal conspiracy in Hyderabad between 2010 and 2013.
The charge was defrauding/ cheating a consortium of banks led by the Central Bank of India.
In furtherance of BCEPL’s criminal conspiracy, it induced other banks to join in, by submitting fraudulent letter of credit documents without any physical movement of goods, and unlawfully availed the credit facilities for which it was not otherwise eligible.
BCEPL then diverted the said loan amount for purposes other than that for which it was sanctioned. The total loss caused to the consortium of banks was Rs 364 crore.
The investigation conducted by the Enforcement Directorate, Chennai, also revealed that a shell company was floated by the Sujana Group through which money was diverted to M/s Viceroy Hotels Ltd.
The ED is also investigating a sister concern of the Sujana Group, Best & Crompton Engineering Pvt Ltd (BCEPL), Chennai, and its directors, K. Sirinivas Kalyan Rao, Meka Ramakrishna Varma, B Narayana-swamy, and B Murali, to identify the proceeds of the money laundering under the Prevention of the Money Laundering Act.
The ED investigated the part of money laundering, during the course of searches of the residential and business premises of key officials of BCEPL as well as its sister company, the Sujana Group, in Delhi, Chennai and Hyderabad.
According to the ED, incriminating material, documents, electronic equipment and high-end vehicles were seized for further examination.
ED authorities said: “In the business premises of Sujana Group at Nagarjuna Hills, Punjagutta, Hyderabad, 124 rubber stamps of different companies were found and seized, including the stamps of BCEPL, their LC beneficiary companies, debtors and trade associates. Investigation into this revealed that funds were diverted to BCEPL through many companies incorporated by the Sujana Group by many circular transactions, and finally paid to M/S Viceroy Hotels Ltd in the guise of business transaction agreement entered into between Viceroy Hotels and Mahal Hotel Pvt Ltd, a shell company floated by the Sujana Group.”
Upon identifying the crime, the ED Chennai attached the properties of Viceroy Hotels, Hyderabad, valued at Rs 315 crore.
