Economy

ED files preliminary money laundering case against GVK Group

Forum Gandhi Mumbai | Updated on July 07, 2020 Published on July 07, 2020

AAI to seek clarity from GVK Group on alleged siphoning of funds

The Enforcement Directorate (ED) has filed a preliminary money laundering case against Mumbai International Airport Ltd (MIAL), its parent company GVK Holdings, and its promoters among others. This case has been registered to probe alleged financial irregularities to the tune of ₹705 crore alleged by the Central Bureau of Investigation (CBI) in its FIR filed on June 27.

Meanwhile, the Airports Authority of India (AAI) will seek clarity from the GVK Group on the alleged siphoning of funds as stated by the CBI and ED.

Senior ED officials told BusinessLine that it has lodged an Enforcement Case Information Report (ECIR) under the Prevention of Money Laundering Act (PMLA) on the basis of the CBI’s FIR. “This case has been registered as a preliminary case to support the CBI probe for the allegations which are financial in nature,” said the senior official requesting anonymity.

 

Under the public-private partnership programme, GVK, its foreign entities, and AAI entered into a joint venture and named it Mumbai International Airport Ltd (MIAL). The agreement was made in 2006 for modernisation and upgradation, operation, and maintenance of Mumbai airport.

In its FIR which was registered on June 27, the CBI had alleged that the GVK Group allotted bogus contracts, underreported revenues, misused reserves meant for the development of the Mumbai airport for the holding company, allowed premium retail spaces to family and relatives at lower rates, booking exuberantly expensive air and train travel for employees and family of those close to GVK Holding among others.

CBI had booked GVK Holdings, its founder Gunupati Venkata Krishna Reddy, his son, Venkata Sanjay Reddy, Managing Director of Mumbai International Airport Ltd, along with eight other people including public servants of Airport Authority of India (AAI) under for alleged siphoning 705 crore in operating of the Mumbai airport.

 

CBI had also conducted searches at the Mumbai and Hyderabad offices of GVK Group.

ED will conduct an independent inquiry to probe the siphoning of funds by the said accused, though, currently, “The ECIR is registered on the basis of the fact that CBI has collected initial evidence,” the official added.

Meanwhile, the Airports Authority of India (AAI) will seek clarity from the GVK Group on the alleged siphoning of funds as stated by the Central Bureau of Investigation (CBI).

“We are in the midst of writing a detailed letter to GVK and MIAL on the said issue. We will ask for a detailed report on the same from them,” a senior official at Airports Authority of India (AAI) told BusinessLine, requesting anonymity that

While there have been no arrests so far, according to sources, there is a possibility the amount siphoned and the number of people booked may increase as the investigation prevails.

The FIR lodged by the CBI was registered under sections 120-B r/w 420, 467, 468, 471 of PC and 13 (1) (D) of PC Act of the Indian Penal Code (IPC) which commissioned of the offenses of fraud, cheating, forgery & criminal misconduct by a public servant.

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Published on July 07, 2020
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