Mumbai: The Enforcement Directorate (ED) on Thursday said that they have conducted searches at various premises in Mumbai on September 11 and 12 in connection with a money laundering probe against Max Flex Imaging and System. Ltd, managed and controlled by Hitesh R Jobalia and Nimesh N Shah.
During the search, various assets were seized, including stocks of Flex, Vinyl, and other items worth ₹12 crore, FDRs totaling ₹1.25 crore, Demat accounts with a balance of ₹6.30 crore, as well as foreign currency, cash, gold jewelry, and silver bars, amounting to ₹20.11 crore.
ED alleges that the firm entered into a criminal conspiracy to cheat SBI
The ED investigation revealed that the company, which is involved in the printing press and paper industry, entered into a criminal conspiracy to cheat the Consortium group of State Bank of India and eight members by fraudulently obtaining loans by submitting inflated stock statements and balance sheets of the said company. ED initiated this investigation based on an FIR registered by the CBI - Bank Security and Frauds Cell in November 2022.
Max Flex and Imaging Systems caused heavy losses
Max Flex and Imaging Systems and their directors were alleged to have caused losses exceeding ₹464.41 crore to a consortium. The company's promoters diverted and misused the funds received from banks to purchase various properties and channel them into firms and companies registered in the names of employees, ex-employees, and relatives of the company's directors (shell companies).Investigation thus far has revealed that the company's account was declared a non-performing asset (NPA) in 2011 and transferred to SBI's stressed assets management branch.
A consortium lending facility was extended to the company. However, as the company continued to default on its debts, a claim was filed before the Debt Recovery Tribunal in 2017, and a forensic audit of its finances, stocks, and receivables was sanctioned.