ED seizes cash and fancy automobiles in case against Kwality Ltd’s ex-promoters.
News Mania Desk / Piyal Chatterjee / 29th November 2024
The Enforcement Directorate claimed on Friday that it confiscated Rs 1.3 crore in cash and “evidence” related to shell firms after searching the former promoters of dairy major Kwality Ltd in connection with an alleged Rs 1,400 crore bank fraud-related money laundering case. Luxury cars and demat accounts worth approximately Rs 6.5 crore have also been blocked under the Prevention of Money Laundering Act (PMLA), according to a statement.
On November 27, the federal agency raided 15 addresses in Delhi-NCR in connection with the investigation, including the homes of former firm promoters and directors Sanjay Dhingra and Siddhant Gupta, as well as some “shell” (paper) companies associated to them.
Kwality Ltd has been liquidated and is now under new ownership. The ED case arises from a CBI FIR filed in September 2020 against the promoters and Kwality Limited, a company that processed and traded milk, ice cream, and other dairy goods. The CBI FIR said that the former company, through its directors, engaged in “falsification and fabrication” of books of accounts by “misrepresentation” of sales, purchases, debtors, and creditors, and subsequently “cheated” a consortium of banks out of Rs 1400.62 crore.
“Huge amounts of trading (sales and purchase) were made without actual physical deliveries or receipt of the goods at factory premises,” according to the agency. It was also noticed that “sham” companies operated through “dummy” owners also sought loans but such funds were used as per the instructions of erstwhile Kwality Ltd, it claimed.
“The funds diverted through the stated modus operandi was circulated and layered in order to conceal its origin and routed to different accounts as per the instructions of the promoters…,” the ED alleged.The agency said Rs 1.3 crore in cash and “evidence” related to assets and bank accounts held through several “shell” companies by the promoters was seized during the raids.
