June 9, 2023: The Directorate of Enforcement (ED) on June 5, 2023, conducted searches at seven locations in Karnataka, owned by Bangalore-based real estate furnishings company Bharath Infra Exports and Imports and its related entities in a bank-fraud case. The search operations were conducted under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA), the ED said in a statement issued on June 7.
During the search operation, the ED unearthed immovable properties worth approximately Rs 100 crore along with Rs. 14.5 lakh in cash. The ED also froze and seized the incriminating documents, digital devices and bank accounts of the company and its related entities during the search.
In a press statement, the government’s enforcement agency said that Bharath Infra Exports and Imports received loans from public lender State Bank of India in the form of cash credit, EPC/FBD, non-fund based working capital and letters of credit. The account was classified as a non-performing asset (NPA) on January 17, 2017, as the company defaulted on loan worth Rs 113.38-crore.
“The investigations done by the ED revealed that the promoters/directors of Bharath Infra Exports and Imports misappropriated the credit facility availed from State Bank of India by wrongful diversion of funds/loans to related parties, submitted forged/fabricated invoices/documents to the bank and also written off sales booked without complying with contractual obligations,” it said.
The ED probe also revealed that Rs 101.18 crore was siphoned off by the company through 10 commercial letters of credit issued to Aradhya Wire Ropes, which got devolved and credited into the bank account of Aradhya Wire Ropes. Subsequently, these proceeds of crime routed through the bank accounts of various other entities.
In many cases, payments were made in favour of a transport contractor and agents, who had provided fake vehicle details and invoices to the two companies without actual movement of material at the site. Further investigation under the PMLA was in progress, the ED said.
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