CHENNAI: The coordinated Enforcement Directorate searches on Monday (April 7) at offices of multiple entities linked to True Value Homes (TVH), owned by Municipal Administration Minister KN Nehru’s brother KN Ravichandran, were the outcome of a 2021 FIR filed by CBI on a complaint by Indian Overseas Bank (IOB) alleging fraudulent diversion of Rs 30 crore loan it disbursed in 2013.
Sources said that ED’s Chennai zone registered an ECIR recently based on the FIR and commenced a money laundering probe. The searches began in Chennai, Coimbatore and Tiruchy on Monday, including at the house of Nehru, and continued on Tuesday, official sources confirmed. CBI alleged that the accused had cheated IOB of Rs 22.48 crore as of June 30, 2021. The agency has already filed a charge sheet in the case.
DMK has condemned the searches, calling it politically motivated to malign the government and create an impression that the minister was involved in corruption. Without revealing specific details about the case, DMK MP NR Elango on Monday questioned the timing of the ED probe - nearly 3.5 years after the CBI filed the case and around 12 years after the occurrence of the alleged crime.
According to CBI, IOB’s Chennai regional office filed a complaint on December 3, 2021, stating that Truedom EPC India Private Ltd with its office at TVH Novella in RA Puram, Chennai, had diverted Rs 30 crore of loan to related parties, which acted as shell companies for the TVH group. Interestingly, Ravichandran and TVH were guarantors for the loans.
IOB, in its plaint, said that the loans were not repaid properly to the bank, which they alleged was an intentional fraud. While Truedom EPC is the main accused in the case, the other accused are Elayaraja Tamizhmaran and Arivunithi Tamizhmaran, who are directors of Truedom EPC.
IOB released the loan on March 30, 2013, under the Insta Fund scheme for setting up a 100.8 MW wind energy project in Tiruppur. The loan was classified as a non-performing asset (NPA) on June 30, 2016.
According to IOB, `26 crore 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 earlier a director in Truedom and was the MD 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 TVH group. They deduced this as the domain name of the email given by Ecodomm in records of the Ministry of Corporate Affairs was of TVH.in.
An inspection by IOB’s chief manager in 2016 showed that the company had not initiated any project at the site, while it should have been completed by September 2013 as per the agreement.
Ravichandran questioned for 3 hours
Chennai: The Enforcement Directorate picked up KN Ravichandran and took him to their Nungambakkam office for questioning on Tuesday. While searches continued for the second day in Chennai, Ravichandran was taken back from the ED’s office to his home in RA Puram after a three-hour questioning session around 8pm, sources said. ED is investigating the case based on CBI’s 2021 FIR alleging diversion of a Rs 30 crore loan, given by IOB to a wind energy firm, to Ravichandran’s TVH group, sources said.
Timeline
March 30, 2013 - IOB releases Rs 30cr loan to Truedom EPC for setting up 100.8 MW wind energy project in Tiruppur
2016 - Inspection by IOB chief manager shows no project initiated at the site
June 30, 2016 - Loan classified as a non-performing asset
December 3, 2021 - IOB files complaint, states Truedom EPC with its office at TVH Novella in Chennai had diverted Rs 30cr to related parties
2021 - CBI files FIR