ED issues provisional attachment order against Shekhar Reddy under PMLA

Reddy has not divulged source of new currency he got in exchange for Rs 34 cr worth of old notes

The Enforcement Directorate, Chennai, has provisionally attached property worth Rs 33,74,92,000 belonging to J Sekhar Reddy and his associates, in connection with the exchange of old notes for new currency notes under the provisions of Prevention of Money Laundering Act, 2002 (PMLA).

The Directorate of Enforcement is conducting an investigation under PMLA against Reddy and others based on the Central Bureau of Investigation (CBI) cases registered against them in relation to the seizure of about Rs 34 crore of new currency notes from them by the Income Tax department. 

           

He was examined under the provisions of PMLA.

ED said Reddy has stated that cash seized by the Income Tax department belongs to his SRS Mining Company and that he admitted it was unaccounted money. He has not divulged the actual source of new currencies other than stating that it is from the sand mining business.

Srinivasulu has claimed that he received money from SRS mining and used a part of the same for converting into gold bars through Premakumar as per the instructions of Reddy. The remaining cash was kept at various premises and the same was earlier recovered and seized by Income Tax department. However, he has not divulged the modus operandi of converting old currencies into new currencies, said the ED in a release.

Investigations revealed that the old demonetised currencies were converted to new currencies through various persons on a commission basis.

As the officials believed that the seized new currencies to the tune of Rs 33,74,92,000 are proceeds of crime,  the same were provisionally attached under the provisions of PMLA .

Further investigations are in progress, said K S V V Prasad, joint director, ED, Chennai.