CHENNAI: TD Prabhavathy, wife of disgraced educationist TD Naidu who allegedly cheated medical education aspirants by promising admission in his unrecognised institution in Tiruvallur district, will also face trial under the Prevention of Money Laundering Act (PMLA) in the case.
A special CBI court last week dismissed a discharge petition filed by Prabhavathy and said that prima facie, she had committed the offence under PMLA. In November 2013, the Enforcement Directorate had registered a case against Naidu, Prabhavathy and others based on a CBI case registered to probe allegations of defrauding several persons including innocent students, the Andhra Bank and the Union Bank of India.
The central agency had arraigned Prabhavathy as an accused, as she was one of the trustees of DD Medical Educational Trust, which had established the DD Medical College and DD Hospital and allegedly cheated the students and the banks.
While the students had been admitted in the institute without getting necessary permission from Medical Council of India, funds to the tune of several crores had been obtained from the bank and allegedly diverted to personal accounts, which formed the predicate offences for ED.
Prabhavathy had filed the discharge petition on the grounds that the claim of college cheating the students was false as they knew that the admission was subject to approval granted by MCI. In addition, she pleaded that the diversion of funds was by bank officials and not by their trust. Thirdly, she contended that she had no role in the trust and was arraigned as accused without any valid evidence.
But, ED contended that Prabhavathy was enjoying income from the properties attached by the agency and was claiming it untainted property. It was she and her husband TD Naidu who approached the bank and obtained the loan for the trust, which later was allegedly diverted, and hence participated in the activities of the trust.
During the hearing, the court took note of a screenshot of a document which said she had resigned from the trust in January 2008, which was before the loan was taken. However, the court perused documents submitted by ED which showed that Prabhavathy had signed as a trustee when the trust applied for a loan from Andhra Bank on August 14, 2008. This led the court to reject her contention.
Regarding the ED’s attachment of a property purchased much before the alleged offence, the court said the petitioner would have to deal with it through an appeal before the Appellate Tribunal.
Cheated students
The central agency had arraigned Prabhavathy as an accused as she was a trustee of DD Medical Educational Trust, which allegedly cheated students and banks