Coal scam: ED attaches assets worth over Rs 1.17 bn of Prakash Industries

ED said a provisional order for attachment of properties was issued by it under the Prevention of Money Laundering Act (PMLA) against the company

The Enforcement Directorate (ED) on Tuesday said it has attached assets worth over Rs 1.17 billion of a company in connection with its money laundering probe in the coal blocks allocation scam case.

It said a provisional order for attachment of properties was issued by it under the Prevention of Money Laundering Act (PMLA) against Prakash Industries Limited.

In a statement, the central probe agency said its investigation in the case revealed that "the company, in furtherance to aforesaid criminal activity, filed false declaration with the Bombay Stock Exchange (BSE) on November 17, 2007 intimating the allocation of coal block whereas the block was actually allocated on February, 2008 jointly to Ms Prakash Industries Ltd and Ms SKS Ispat Power Ltd".

As a result of filing of this false declaration, the shares of Prakash Industries recorded an astronomical rise in their value, it said.

The ED alleged that "in order to encash the artificially created rise" in their share value, the company issued 62,50,000 preferential shares on premium of Rs 180 per share and sold these shares to five selected companies and in the process generated Rs 1.18 crore in the form of share capital.

"The amount of Rs 1.18 billion, which was generated as a result of the schedule offence as committed on the date of filing of application for allocation of coal block by giving false net worth details and further false declaration to BSE, is the proceeds of crime, which are liable to be provisionally attached under the PMLA," it said.

It said the assets worth Rs 1.17 billion, in the form of movable and immovable properties of the company, were attached.