CHENNAI: Enforcement Directorate’s searches on April 7 at the offices of multiple entities linked to True Value Homes (TVH), owned by Tamil Nadu Municipal Administration Minister KN Nehru’s brother KN Ravichandran, are the outcome of a 2021 FIR filed by the CBI based on a complaint by Indian Overseas Bank (IOB), alleging the fraudulent diversion of a Rs 30 crore loan disbursed in 2013.
Sources said that the ED’s Chennai zone has recently registered an ECIR based on this FIR and commenced a money laundering probe.
The searches began in Chennai, Coimbatore, and Tiruchy on Monday, including at Nehru’s house, and are continuing today, official sources confirmed. The CBI has already filed a chargesheet in the case.
The ruling DMK condemned the searches, calling them politically motivated to malign the government and create an impression that the minister was involved in a corruption case.
Without revealing specific details about the case, DMK’s Rajya Sabha MP and senior advocate N R Elango on Monday questioned the timing of the ED probe, nearly 3.5 years after the CBI registered the case and around 12 years after the occurrence of the alleged crime.
According to the CBI, IOB’s Chennai regional office complained on December 3, 2021, that a firm, Truedom EPC India Private Ltd., with its office at TVH Novella in RA Puram, Chennai, had diverted Rs 30 crore of a loan to related parties, which acted as shell companies for the TVH group. Interestingly, Ravichandran and TVH Homes were guarantors for the loans.
IOB, in its complaint, said that the loans were not repaid properly to the bank, which they alleged was an intentional fraud. The other accused in the case are Elayaraja Tamizhmaran and Arivunithi Tamizhmaran, directors of Truedom EPC.
The company was sanctioned a loan of Rs 30 crore under the Insta Fund scheme by IOB for setting up a 100.8 MW wind energy production project in Tiruppur district. The loan was released on March 30, 2013. The loan amount was classified as a Non-Performing Asset (NPA) on June 30, 2016.
According to IOB’s complaint, Rs 26 crore of the loan amount was transferred to TVH (India) Private Ltd by adjusting the book entries. This was allegedly done by routing the funds through Sri Balaji Traders, Mark Green Developers, and Ecodomm Power Private Ltd., which, according to the bank, were shell companies.
IOB’s forensic audit reportedly showed that the proprietor of Sri Balaji Traders, Selvamani Thiyagarajan, was previously a director in Truedom and was the managing director of TVH Energy Resources Private Ltd.
Sri Balaji Traders had borrowed unsecured loans from TVH Energy from 2010-11 to 2012-13, which indicated that Selvamani was a related party, the bank said in the complaint.
The audit also found that KN Nehru’s son and Perambalur MP Arun Nehru was a director of Ecodomm Power. The bank’s complaint stated that Ecodomm Power Pvt Ltd was a related concern of the TVH group. They deduced this because the domain name of the email provided by Ecodomm in records of the Ministry of Corporate Affairs was from TVH.in.
An inspection by IOB’s chief manager in 2016 showed that the company had not initiated any project at the site, even though it should have been completed by September 2013 as per the agreements. This, according to the bank, was an indication that the funds were never utilized for the purpose for which they were sanctioned.