The Enforcement Directorate (ED) has provisionally attached assets to the tune of Rs 452 crores belonging to a Singapore company in connection with its probe into alleged money laundering associated with irregularities in IL&FS group companies.
The agency claimed it has attached assets, in the form of shares, that M/S AS Coal Pte Singapore held in ILFS Tamil Nadu Power Company Limited (ITPCL). Owned by British national Jaimin Vyas, AS Coal, which ED has claimed is a shell company, had acquired 8.86% shares in ITPCL. This has been identified by ED as proceeds of crime owing out f kickbacks that Vyas received for favouring a Chinese company with an ITPCL contract.
The ED case is based on a Delhi police FIR and investigations conducted by the Serious Fraud Investigation office (SFIO) against IL&FS Financial Services (IFIN) and its officials.
ED has claimed there was a “planned conspiracy to defraud IL&FS and Indian banks” by Jaimin Vyas in connivance with official on IL&FS and Chinese engineering, procurement and construction (EPC) company M/s SEPCO III.
“The company’s right to select the EPC Contractor was illegally delegated to Jaimin Vyas, violating the terms and conditions of Share Purchase Agreement. Jaimin Vyas thereafter nominated SEPCO as EPC contractor and got kick back in guise of fees for consultancy services. The same money was routed as equity investment in ITPCL. Subsequently, ITPCL paid SEPCO III the amount (paid earlier by SEPCO to Jaimin Vyas) by inflating the value of the contract and payments were also made in the guise of early completion of project,” ED has said in a statement.
It has claimed Vyas also received illegal gratification from M/S Noble Coal in lieu of allegedly awarding coal supply contract (to ITPCL) at an inflated rate.
Earlier, ED had attached movable and immovable properties of committee of directors of IFIN totaling to Rs 126 crores, and movable and immovable properties of two defaulters of IFIN, M/s SIVA Group and M/s ABG Group totaling to Rs 1400 crores.
The Indian Express had in July, 2020, reported that an audit report, prepared by Grant Thornton, of ITPCL had raised concerns over the transaction underlying the sale of ITPCL stake to AS Coal Resource as it has found that SEPCO Electric Power Construction Corporation allegedly provided financial assistance of about Rs 800 crore to entities associated with Vyas, for acquisition of ITPCL shares.
The audit report, submitted to a consortium of lenders led by Punjab National Bank in June 2020, had found that SEPCO was one of the contractors of ITPCL and it had received money from the power firm for various contracts.
ITPCL operates a 1,200-MW imported coal-based plant in Cuddalore. Around Rs 10,600 crore was invested in the project, of which public sector banks have given loans of Rs 6,080 crore and IL&FS Energy Development Company Ltd (IEDCL), a subsidiary of IL&FS, has put in Rs 4,560 crore.
ITPCL, which is undergoing insolvency proceedings, owes over Rs 6,700 crore to banks and about Rs 900 crore to IL&FS entities. At present, AS Coal Resource has 8.6 per cent stake in ITPCL and IEDCL holds the remaining 91.4 per cent.