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Rs.1034 cr. money laundering scam, Mumbai businessman arrested

Mumbai: The Enforcement Directorate on Wednesday arrested a Maharashtra-based businessman in a money laundering probe linked to a ₹ 1,034 crore land ‘scam’ related to the re-development of a ‘chawl’ in Mumbai.

Pravin Raut, a former director of a company called Guru Ashish Construction Pvt Ltd, was arrested following his questioning at the ED office in Mumbai.

Premises linked to him were searched by the agency on Tuesday.

Mr Raut was produced before a special Prevention of Money Laundering Act (PMLA) court in Mumbai that sent him to ED custody for eight days till February 9, the agency said in a statement.

“Pravin Raut was found involved in offence of money laundering and to unearth the money trail and the siphoning of funds running into more than 1,000 crore, he was arrested…,” it said.

The ED said Guru Ashish Construction Pvt Ltd was involved in re-development of Patra ‘chawl’ in suburban Mumbai’s Goregaon area. The ‘chawl’ had 672 tenants in tenements on 47 acres land belonging to the Maharashtra Housing Area Development Authority (MHADA).

Guru Ashish Construction Pvt Ltd is a subsidiary company of the Housing Development Infrastructure Ltd (HDIL).

The HDIL is under investigation by the ED and a few other agencies in connection with the around ₹ 4,300 crore alleged fraud at the Punjab and Maharashtra Cooperative (PMC) Bank.

The ED said the company (Guru Ashish) had entered into a “tripartite agreement’ with the tenants and the MHADA to re-develop the ‘chawl’.

“Pravin Raut along with Rakesh Kumar Wadhawan and Sarang Wadhawan, directors of Guru Ashish Constructions Pvt Ltd, in connivance with others illegally sold FSI (floor space index) to various builders for ₹ 1,034 crore.

“This was done without constructing the rehab flats and flats to be handed over to MHADA, which was the pre-requisite,” it alleged.

Mr Raut, being the director of Guru Ashish Construction Pvt Ltd, has played an “active role” in the re-development project, and in connivance with Rakesh Kumar Wadhawan and Sarang Wadhawan, managed to “divert” the proceeds of crime of more than ₹ 1,000 crore by “harming” the interest of 672 tenants and buyers, the ED said.

“In addition to ₹ 1,034 crore received from various builders, they had also obtained bank loans,” the agency stated.

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