The directorate of enforcement (ED) has provisionally attached movable and immovable assets worth about ₹112.90 crore belonging to LEEL Electricals Ltd (formerly Lloyd Electric & Engineering Ltd), company promoter Bharat Raj Punj and others in connection with an alleged bank fraud and money laundering case involving a consortium of lenders led by State Bank of India (SBI).
The attached assets include land, industrial plots and residential properties in Delhi, Uttarakhand, Gujarat, Madhya Pradesh, Telangana, Goa, Maharashtra and Tamil Nadu. The attachment also covers a residential property in Houston, Texas, in the US, besides bank balances, fixed deposits and mutual fund investments.
The money laundering investigation stems from a first information report (FIR) registered by the Central Bureau of Investigation (CBI) under various provisions of the Indian Penal Code and the Prevention of Corruption Act against LEEL Electricals, Mr Punj and other senior company officials.
ED says the CBI's FIR and subsequent chargesheet allege that the promoters and key managerial personnel entered into a criminal conspiracy to cheat a consortium of banks led by SBI by submitting false and manipulated financial statements, causing a wrongful loss of about ₹376 crore to SBI and IDBI Bank.
According to ED, its investigation under the Prevention of Money Laundering Act (PMLA) found that the accused orchestrated a systematic scheme to siphon off bank funds by manipulating the company's financial records.
The agency alleges that the company's books of account were falsified by inflating the value of assets, inventories and receivables to project a misleading financial position and continue availing bank credit facilities.
The probe also found that the diverted funds were allegedly routed through a network of promoter-controlled and related companies in India before being transferred to several overseas subsidiaries in the guise of investments and loans.
ED says a substantial portion of these funds could not be traced, indicating that the overseas entities were allegedly used to divert and conceal the proceeds of crime.
According to the agency, the diverted funds were subsequently integrated into the financial system through the acquisition of immovable properties in the names of related companies and members of the promoter family.
Several of these properties were later sold and the sale proceeds were allegedly used for the personal and operational expenses of the promoter family, including those of Renu Punj, mother of Bharat Raj Punj.
The investigation also found that a significant portion of the allegedly diverted funds had been routed outside India through an overseas subsidiary structure allegedly controlled by Mr Punj.
Based on these findings, ED has attached a residential property in Houston, Texas, jointly owned by Mr Punj and his wife, Pooja Punj, stating that it represents proceeds of crime held outside India.
The agency says further investigation is underway.
In 2024, coming down heavily on the managing director (MD), whole-time directors (WTDs), key management personnel (KMP) and members of the audit committee (AC) of LEEL Electricals for siphoning off significant funds and taking out proceeds from the sale of its consumer durable (CD) business, the Securities and Exchange Board of India (SEBI) has asked seven entities to pay a penalty of ₹14.20 crore.
SEBI directed LEEL's MD Bharat Raj Punj to pay a penalty of ₹5 crore, Anita Kakar Sharma, company secretary and vice-president for finance, a penalty of ₹3 crore. Three people, viz., Achin Kumar Roy, WTD, who had signed FY17-18 statements as chief executive officer (CEO) or chief financial officer (CFO), Nipun Singhal, WTD and in charge of LEEL's CD business and Mukat Behari Sharma, WTD and CFO, to pay a fine of ₹2 crore each. LEEL's two independent directors (IDs) Surjit Kishan Sharma and Geeta Tekchand, are asked to pay ₹10 lakh penalty each. (Read:
LEEL Electricals: SEBI Slaps Rs14.20 Crore Penalty on MD, WTD, KMPs for Siphoning Money)
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