The money laundering case stems from a charge sheet filed by the Serious Fraud Investigation Office, an investigative agency under the Ministry of Corporate Affairs.
A probe found that the erstwhile Bhushan Steel Limited (BSL) and its Managing Director Neeraj Singal and his associates formed several shell companies, the agency alleged in a statement.
After completing the corporate insolvency resolution process (CIRP), Bhushan Steel was taken over by Tata Steel Ltd in 2018.
The ED alleged the promoters and entities linked to BSL “rotated funds from one company to another through a chain of multiple entities.”
“The funds were circulated to infuse capital, buy property and for other personal purposes not intended by the banks,” it claimed. The promoters, directors and the officials of BSL prepared “forged” documents and made fraudulent representations before the banks to discount LCs (Letters of Credit) and “diverted” the funds back into their own web of companies with “malafide” intentions causing wrongful loss to the State Bank of India and the Punjab National Bank. “During the search operations, various incriminating documents and digital records were seized. The digital evidence was found hidden with key employees/confidants of Neeraj Singal,” it said.
The agency also seized Rs 72 lakh in cash, foreign currency/travellers cheques worth about Rs 52 lakh and three luxury cars (Mercedes Benz) having acquisition value of Rs 4 crore during the raids.
Singal was arrested by the ED in June this year and he is currently in judicial custody. It had also attached assets worth Rs 61.38 crore in this case.