NEW DELHI: When an apellate tribunal on Wednesday upheld the Enforcement Directorate (ED)'s attachment of a Rs 30 crore jet linked to a Rs 47,000 crore bank fraud case involving Bhushan Power & Steel Limited (BPSL), it brought to an end a long saga of deceit.
The story starts in the mid-2000s, when BPSL established itself in the booming steel industry. The company had set up several manufacturing units across the country and had announced additional expansion plans to get bank loans.
The ED said that the loans, on paper, were for legitimate industrial purposes after the bankers trusted the projections placed before them. But in reality a significant portion of the loans was systematically siphoned away through shell companies.
The fraud was revealed during an Income Tax raid at the BPSL premises in December 2014.
Between 2007 and 2014, BPSL and its directors -- Sanjay Singal, Aarti Singal, Dinesh Kumar Yadav, Ravi Prakash Goyal among others -- availed credit facilities worth over Rs 47,204 crore from 33 banks and financial institutions.
Over Rs 2,348 crore was diverted into various companies as fictitious advances between April 2007 and March 2014 without any business dealings and, of that, Rs 537.85 crore was routed through 86 shell companies.
The agency said that fake CENVAT-able invoices were arranged through a network of paper companies. Bogus transport documents, gate receipts, and vouchers were fabricated to give the transactions an appearance of legitimacy.
As the accounts of BPSL remained irregular, Punjab National Bank by December 2015 declared it as a non-performing asset. Thereafter other banks also did the same and the outstanding defaulted loan amount on January 30, 2018 was a staggering Rs 47,204 crore.
The CBI filed a case in April 2019. The ED soon launched a probe into the money laundering after registering an ECIR.
While tracing the money trail, the ED found one asset emerging as particularly symbolic—a Cessna 525A CJ 2+ private jet—registered under Bhushan Airways Services Pvt. Ltd. (BASPL).
The aircraft had been purchased in 2009 for a total consideration of Rs 30.90 crore.
They found that around Rs 9.90 crore paid directly towards the aircraft's purchase was routed through entities controlled by Sanjay Singal—Olympian Finvest Ltd., Vintage Steel Pvt. Ltd., Aromatic Steel Pvt. Ltd and Titanic Steel Industries Ltd.
The remaining Rs 21 crore was availed as a loan from Punjab National Bank through different companies: Evergrowing Finvest, Flawless Holdings, Gainda Mal Chiranji Lal Pvt. Ltd and Kishorilal Constructions.
Then came the most significant finding; the sole director of BASPL—the aviation company that owned the private aircraft—was not a businessman, but a priest.
“It was also found that the Director of M/s BASPL, Shri Vijay Kumar Tiwari was merely a priest and was made a dummy director by Shri Ravi Prakash Goyal and Shri Sanjay Singal. He was unaware about the business transactions, as revealed by his statement under section 50 of the PMLA,” the tribunal order stated.
When the priest was questioned, he was clueless about BASPL or Sanjay Singal, the agency said. In June 2022, the ED attached the Cessna permanently.