Bank fraud case: ED attaches assets of Rs. 3.25 Cr of M/s GS Oils Ltd

Enforcement Directorate (ED) attached several immovable properties located in and around Adilabad and in Maharashtra, totaling Rs. 3.25 Crore, in a bank fraud case against M/s G.S. Oils Limited and M/s Makhariya Agro Tech Pvt. Limited.

The Central Bureau of Investigation (CBI), BS and FC, Bangalore had filed a Chargesheet in Chief Metropolitan Magistrate, Hyderabad against the company M/s GS Oils Ltd. and its directors Manoj Kumar Makharia, Sanjay Kumar Makharia, Umesh Kumar Makharia among others, invoking Sec. 120(B) r/w 420 of IPC, 1860, for availing LC facilities and various credit facilities fraudulently by submitting false documents and inflated stocks and receivables statements to State Bank of Hyderabad to get more drawing power from the cash credit account of SBH.

Investigation revealed that M/s GS Oils Ltd. diverted the loan amounts for purchase properties in the names of its group companies and entities, but did not repay the loans and hence became Non-performing asset (NPA) on July 11, 2017.

The bank also had to suffer a loss of Rs. 65.22 Crores after taking into account the various properties pledged as collateral security amounting to Rs. 208.64 Crore, for which action has been initiated by the bank under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI Act).

In addition, the bank had separately initiated action before Debts Recovery Tribunal (DRT) on 1975 acres of agriculture land under mortgage.

Based on the charge sheet, the ED has initiated investigation under Prevention of Money Laundering Act, 2002 (PMLA) against M/s GS Oils Ltd., M/s Makharia Agro Tech Pvt. Ltd. and its directors.

ED investigations revealed that by M/s GS Oils Ltd. and M/s Makharia Agro Tech Pvt. Ltd. took loans from State Bank of Hyderabad and routed to their group companies and entities floated in the names of their family members and employees and finally used for purchase of immovable properties in their names.

Accordingly, immovable properties comprising of 772 Acres of land valued at Rs. 3.25 Crore, acquired by its group companies and entities are identified.

Further investigation is under progress.