ED attaches properties worth Rs. 13.51 cr in Servomax India bank fraud case
The ED initiated a money-laundering investigation on the basis of an FIR dated 2 February 2018 registered by the CBI under various sections of the IPC against Servomax India Private Limited (SIPL), its promoters and directors, namely Venkateswara Rao Avasarala, Poreddy Chandrasekar Reddy, and others for allegedly cheating and defrauding public sector banks to the tune of Rs. 402 crore.
By Newsmeter Network Published on 15 March 2022 10:33 AM GMT
Hyderabad: The Enforcement Directorate (ED) has provisionally attached 15 immovable properties worth more than Rs. 13.51 crore in the Servomax India Private Limited bank fraud case. The attached properties are in the name of the relatives of the firm's directors P. Chandrashekhar Reddy and A.V Rao and their benamidars.
The ED initiated a money-laundering investigation on the basis of an FIR dated 2 February 2018 registered by the CBI under various sections of the IPC against Servomax India Private Limited (SIPL), its promoters and directors, namely Venkateswara Rao Avasarala, Poreddy Chandrasekar Reddy, and others for allegedly cheating and defrauding public sector banks to the tune of Rs. 402 crore.
The investigation revealed that SIPL had availed loans from a consortium of banks, including Letters of Credits, bank guarantees, and working capital loan, and then diverted the same. They did not use the loans for the stated purposes and did not repay the loans. Fund trail investigation revealed that the company had issued LCs in the name of its shell entities and without supplying any material got the LCs discounted and routed back the proceeds of LC discounting. The promoters used it for their personal gain or to invest as share capital/advance loan in their businesses.
Further, money was also withdrawn in cash and through accounts of its petty employees. During the investigation, two benamidars – Atluri Prasad and J. Rajesh of Maruthi Travels – admitted to the laundering of the proceeds of crime. Despite liquidation of SIPL via NCLT, the accused promoters managed to alienate POC and purchase assets in the names of their family members and benami entities, the ED found.
ED identified 15 properties in and around Hyderabad and attached the same under PMLA on 14 March. Earlier, A.V Rao was arrested under PMLA on 17 January 2022 and is in judicial custody.
