NEW DELHI: The Supreme Court on Tuesday directed the Enforcement Directorate (ED) to investigate money laundering by directors and officials of real estate major Amrapali Group, which siphoned off money of around 42,000 homebuyers in Noida and Greater Noida, leaving them in the lurch. The agency has subsequently filed a criminal case of money laundering against the Group and its promoters.
According to ED officials, an investigation was already been initiated, and a case filed in the agency’s zonal office in Lucknow under the Prevention of Money Laundering Act earlier this month. “A case was filed after taking cognizance of at least 16 First Investigation Reports registered against the Group by the Noida Police,” a senior ED official informed.
Meanwhile, sources in the Ministry of Corporate Affairs said the Serious Fraud Investigation Office is also likely to initiate a separate probe in the matter. A group of homebuyers had already approached corporate affairs secretary. After homebuyers moved Supreme Court against the Amrapali Group, a bench comprising Justices Arun Mishra and U U Lalit had, sensing serious financial discrepancies, ordered forensic auditing of the company’s accounts.
The report was subsequently submitted to the top court in May this year.The 2,000-page report submitted by court-appointed auditors Ravi Bhatia and Pawan Aggarwal said that the collapse of Amrapali Group was not due to change in market conditions or investment decisions, but due to “wilful criminal actions” of its proprietors. The promoters and top officials of the firm diverted homebuyers’ money for personal benefits and building their own empire, it said.
The report pointed out that the Group set up more than 100 shell companies in the names of officials; around 23 such firms were set up in the names of office boys, peons and drivers. The top brass of the Group used these bogus firms to divert funds worth Rs 3,000 crore.
The report also revealed that posh flats were booked for as low as Rs 1, Rs 5 and Rs 11 per square feet. The ill-gotten money was spent on houses, luxury cars and weddings, and was invested in shares and mutual funds. The auditors noted that over Rs 9,500 crore can be recovered from the company.