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The Enforcement Directorate (ED) has provisionally attached immovable assets totaling to ₹122.15 crore under the Prevention of Money Laundering Act, 2002 (PMLA) in a loan fraud case.
The attached assets belong to Deccan Chronicle Holdings Limited (DCHL) and two of its former promoters, T Venkatram Reddy and T Vinayakravi Reddy, and to a benami company floated by them.
The immovable assets are comprise 14 properties located in New Delhi, Hyderabad, Gurugram, Chennai, Bengaluru etc. All these attached assets are not covered under the NCLT process. This is the second attachment in this case. Adding the earlier attachment, the total amount of assets attached so far comes to ₹264.56 crore.
Investigations under PMLA were initiated by ED against DCHL and its management in 2015, based on six FIRs and corresponding charge sheets filed by CBI. The total loan fraud committed by DCHL and its promoters is estimated to be ₹8,180 crore. DCHL is currently under the CIRP process in which a resolution plan for only ₹400 crore has been approved by the NCLT.
The ED said that “investigation conducted under tjhte PMLA revealed that the three promoters of DCHL, namely PK Iyer, T Venkatram Reddy and T Vinayakravi Reddy, hatched a well planned conspiracy and manipulated the balance sheets of the company inflating the profits-advertisement revenue and grossly understated the financial liabilities of the company to paint a rosy picture for years to cheat the banks and its shareholders.”
“Balance sheets of the company were fudged and loans taken from one bank were hidden from other financial institutions. Over the years, DCHL availed credit facilities to the tune of more than ₹15,000 crore,” it added in a statement.
“Money trail investigation revealed that most of the loans were cyclically rotated into group companies and were diverted to pay back older loans. Loans taken for working capital requirements and for business needs of DCHL were diverted to extravagant projects and the diverted funds which were so invested into new projects without the consent of the banks and were ultimately shown as losses. Substantial amounts out of the loans were diverted into subsidiaries which have not done any legitimate business and also into the proprietary concerns of the two ex-promoters without any proper accounting,” the statement added.
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