ED arrests Sahiti Group’s former director Purnachandra Rao for pre-launch offer scam

Hyderabad: The Directorate of Enforcement (ED), Hyderabad Zonal Office, has arrested Sandu Purnachandra Rao, former Director of Sahiti Infratec Ventures India Pvt. Ltd. (SIVIPL) and head of the Sales and Marketing team, on Monday.

The arrest was made under the provisions of the Prevention of Money Laundering Act (PMLA), 2002.

Sahiti promised a gated community in the pre-launch offer

The ED initiated an investigation based on an FIR registered by Telangana Police against SIVIPL, B Lakshminarayan and others for advertising a ‘pre-launch offer’ for the construction of a ‘world-class residential gated community’ and collecting huge amounts from prospective buyers.

The company, however, failed to deliver the flats to the customers or to refund their money and thus cheated them of their hard-earned savings.

Lakshminaryan, the MD of SIVIPL, was arrested by ED on September 29, 2024, and is in judicial custody.

700 homebuyers cheated of Rs 360 crore

Subsequently, various other FIRs were registered on the basis of complaints of investors/buyers of different projects undertaken by SIVIPL and other group entities. More than 700 homebuyers, who were promised delivery of flats/villas, were defrauded of a cumulative amount of close to Rs 360 crore.

No RERA/HMDA permission for construction or escrow to hold investor’s funds

ED investigation revealed that SIVIPL did not have the necessary RERA/HMDA permission.

Further, there was no escrow account for the project and the funds received from investors were deposited in various bank accounts and also collected in cash.

Sandu Purnachandra Rao assisted Lakshminarayana in the collection of funds of more than Rs 800 crore by the sale of inventory in illegally launched projects of SIVIPL and cheated the public on the false pretext of the sale of inventory without having the necessary permissions/approvals.

Cash from buyers kept off books

He illegally collected a substantial quantum of cash from buyers, which was not entered in the books of accounts of SIVIPL with a clear intent to conceal and siphon funds of SIVIPL, the ED report said.

More than Rs 216.91 crore cash was collected from buyers on the pretext of the sale of inventory in the project Sarvani Elite.

Purnachandra Rao misappropriated Rs 126 crore from company

In addition to the above, Sandu Purnachandra Rao was also involved in the misappropriation of approximately Rs 126 crore from SIVIPL, which comprised more than Rs 50 crore collected in cash.

When this fact was revealed to Lakshminarayana after a forensic audit, he registered three FIRs against Sandu Purnachandra Rao for misappropriation of funds.

For the withdrawal of the said FIRs by Lakshminarayana, Sandu Purnachandra Rao entered into a settlement agreement with Lakshminarayana and transferred 21 immovable properties in the names of employees of Sahiti Group and others for the beneficial ownership of Lakshminarayana.

Sandu Purnachandra Rao purchased immovable properties in the names of his family members and entities (Royal Nirman Infra Projects, Mahogany Farmlands Projects and Sreegruha Estates) from the Proceeds of Crime (POC) acquired by him.

Earlier, ED had conducted searches in connection with the case at various premises, seized incriminating material, digital devices and had frozen several bank accounts.

Rs 161.50 crore worth of assets attached so far

Further, movable and immovable properties worth Rs 161.50 crore were provisionally attached during the course of the PMLA investigation.

Sandu Purnachandra Rao was produced before the Special Court (PMLA), Nampally, Hyderabad, on Tuesday, and the court remanded him to 15 days of judicial custody.

Further investigation is in progress.