ED’S Attachment of Former BPSL Chief Singhal’s Properties Upheld

The adjudicating authority under the Prevention of Money Laundering Act (PMLA) has upheld the Enforcement Directorate’s proportion attachment of properties of former Bhushan Power & Steel Ltd. Chairman Sanjay Singhal in connection with the Rs. 47,000 crores bank fraud scandal.

The ED had provisionally attached four properties/assets worth Rs 204 crores belonging to Singhal in March 2020. Earlier this week, the adjudicating authority had confirmed the attachment of the properties-a house in Jor Bagh worth Rs. 74 crores, another in Tolstory Marg worth Rs. 11 crores, a house in London (One Hyde Park, Knightsbrdge) worth 99 crores, and fixed deposits worth RS 19 crores.

“There is considerable evidence regarding obtaining/deriving of proceeds of crime by commission of the scheduled offences. There is sufficient evidence of such proceeds of crime having been utilized by the defendants (accused),” the authority said in its order.

“Consequently, the properties acquired from the proceeds of crime are liable to be attached as the value of the proceeds of crime.”

On July 12, the chairperson (officiating) of the authority, which is in under the revenue department, had said, “Prima facie, the amount so earned from the scheduled offences and criminal activity relating thereto is utilized by the principal defendants for their gain. Thus, money laundering is presumed as well as is established.”

The order read, “In order to rebut this presumption, it was absolutely essential for the accused to show that there was no emergence of proceeds of crime. The accused, however, failed to show that. Nothing is produced by the accused which would rebut the presumption. The burden to prove that the properties/monies are not proceeds of crime and were not, therefore, tainted, rests with the accused… the accused have failed to discharge the burden of proof.”

In its submission, the ED had informed the adjudicating authority that “tracking more proceeds of crime is underway.”

The federal agency said, “Sanjay Singhal, by way of criminal activity related to scheduled offences, has diverted huge sum money, obtained as loans from banks, which was routed to different group companies, either in the form of equity infusion through shell companies or projected as unsecured loans and laundered the same by creation of movable/immovable properties.”

Seeking immediate attachment of his properties, the ED said, “On account of past conduct of the accused and their capability and propensity to acquire and launder the proceeds of crime in a highly sophisticated and circular manner, the non-attachment is likely to frustrate the proceedings under PMLA 2002 relating to confiscation of such proceeds of crime.”

ET was the first to report on Thursday that the adjudicating authority has disapproved the “hurriedness” in sale of the said London house by Standard Chartered Bank, holding that the sale was not executed in a “bona fide manner”

The authority held that the British multinational bank acted in “haste” to sell a property which stood provisionally attached by the ED, giving the agency liberty to take “necessary steps as per law to secure the custody of the attached (London) property” S-ET

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