The Enforcement Directorate (ED) provisionally attached properties worth ₹246 crore related to the gutkha scam that had rocked Tamil Nadu. These include 174 immoveable properties situated in Tamil Nadu, Puduchery and Andhra Pradesh, with market value of ₹243.80 crore and moveable properties in the form of shares and vehicles worth ₹2.29 crore.

The ED probe revealed that the accused — AV Madhava Rao, PV Srinivasa Rao, Tallam Uma Shankar Gupta and others --were involved in illegal manufacture, sale and distribution of gutkha products in Tamil Nadu with a turnover of whopping ₹639.40 crore from June 2013 to June 2016. “The ill-gotten money derived out of the criminal activities were invested in moveable and immoveable properties in Andhra Pradesh, Puducherry and Tamil Nadu,” stated the ED press release. The ED further stated that the criminal activity related to the payment of bribe to the Central and State government officials as quid pro quo for allowing the illegal business of gutkha and other tobacco products.

Land buying

The probe also revealed that investments made by the accused were in land, allegedly purchased in the name of Gayathri Realtors, Medha Dairy and Vaijayanthi Spinners. The consideration was paid through cash generated out of the sale proceeds of the illegal gutkha business. “Three factory premises were also acquired by the accused in the names of relatives and employees during the period to facilitate smooth running of their illegal gutkha business,” it said.

Further, out of the profits of the gutkha business, personal investments were made by the accused by purchasing land in their name and in the name of family members and relatives. Besides, shares were purchased in Goutham Buddha Textile Park, Guntur, and vehicles were purchased for the sale and distribution of the gutkha products. The major investments in real estate made by the accused were in Guntur district of Andhra Pradesh apart from investments in Salem, Puducherry and Chennai. These assets consists of 174 immoveable properties and moveable properties.

Investigations were carried out under the provisions of Prevention of Money Laundering Act (PMLA) on the basis of CBI’s first information report after the Chennai High Court asked the agency to probe all aspects of the offence including manufacture, import, supply, distribution and sale of gutkha and other chewable tobacco as they were banned in Tamil Nadu and Puducherry from May 2013 onwards.

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