A Jaipur-based gem company defrauded Bank of Baroda of Rs 29 crores by laundering away loans it had availed under the garb of conducting business. The Enforcement Directorate (ED) has swooped in on it’s proprietors, and after investigations have attached properties worth Rs 5.11 crores in the case, according to a press statement issued by ED.

These properties belong to Shanti Kumar Chordia, Umrao Mal Chordia and Nayantara Chordia and assets consist of four immovable properties valued at Rs 3.80 crores including three residential-cum-business houses in Jaipur and a flat located in a posh locality in Mumbai and fixed deposit of Rs 1.31 crores in State Bank of India, Jaipur.

The alleged fraudsters run companies that go by the names of Vipul Gems Pvt Ltd, Vipul Gems and KV Exports and were engaged in export of precious stones.

ED investigations revealed that these entities had taken ‘Packing Credit,’ (PC) which is advance for purchase of raw material and to meet export related expenses and ‘Post Shipment Demand Loan,’ (PSDL) which is advance given after export on the basis of export documents for post shipment requirement to the tune of Rs 29 Crores from the Bank of Baroda, Nehru Place Branch, Jaipur during the period 2006-07.

“It was revealed that for availing credit, facilities forged and fabricated export orders were submitted. The amounts released were not used for business purposes but were diverted. The bills remained outstanding for the purported exports made by these companies. The foreign buyers had either returned the goods, made payments directly to the borrowers or had not at all received the goods,” the ED press note states.

It further says, these entities also opened new current account in the name of Gems International and also transferred some of the loan advance on account of PC and PSDL to this account. In this way, the funds were diverted and misappropriated by these entities. Investigation further revealed that the borrowers had systematically and with criminal intention diverted and misappropriated the funds for settling their personal dues and old dues with previous bank – State Bank of Bikaner and Jaipur, and not utilized them for the purpose for which they were borrowed.

In this case earlier an immovable property in the form of a residential bungalow valued Rs 1 Crore situated in Shyam Nagar, Jaipur had already been attached under Prevention of Money Laundering Act (PMLA).

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