Mumbai: ED arrests businessman Pravin Raut in connection with FSI sale linked money laundering case

Businessman Pravin Raut has been arrested by the Enforcement Directorate (ED) officials in connection with a money laundering case related to a redevelopment project in Goregaon. Raut was produced before the court on Wednesday, which remanded him to ED custody till February 09.

A case of criminal conspiracy and cheating was registered by the Mumbai Police in March 2018 after which ED registered a money laundering case in September 2021 and began their investigation.

According to the ED, MHADA is the owner of a land at village Pahadi in Goregaon admeasuring 47 acres. On the said land, MHADA had provided tenements to 672 tenants being members of Goregaon Siddharth Nagar Sahakari Grihanirman Sanstha Limited (Patra Chawl). In order to redevelop the said 672 tenements, the MHADA entered into joint development agreement with one Guruashish Construction Pvt Ltd, a subsidiary of Housing Development and Infrastructure Ltd (HDIL).

"Guruashish Consruction has cheated MHADA by floating the proposal for redevelopment of the land belonging to MHADA and inducing MHADA to enter into contractual arrangement for rehabilitation of the tenants. Thereby M/s Guruashish obtained permissions from MHADA to enter upon MHADA land and carry out development activities but the developer sold the FSI of the free sale component and created third party rights on land belonging to MHADA," ED officials alleged.

"During the court of PMLA investigation, it is revealed that Raut was holding 25% shares of Guruashish Pvt Ltd till March 2010 and was actively involved in various activities relating to the project. On Tuesday, ED had conducted a search at Raut's Wadala residence which resulted in seizure of documents. He was placed under arrest early on Wednesday morning. The investigations so far confirms that Raut, Rakesh Kumar Wadhawan and Sarang Wadhawan all directors of Guruashish had conspired together and hatched a conspiracy to fraudulently raise and siphon off money from this project without any intent to complete the project and thus jeopardising the future of 672 tenants whose dwellings had already been demolished," the ED alleged.

The ED also alleged that, as per the Deed of Confirmation and Modification Agreement dated November 03, 2011, entered into between society, MHADA and Guruashish, the estimated cost of construction of the whole project was Rs 1017 crore and the rehabilitation portion required to be completed first.

"As per the agreement, it was incumbent on the developers to seek permission of MHADA for each sale. This was for the purpose of keeping an account of inflows accrued by the developer by MHADA. In order to circumvent this requirement, Raut wrote a letter in May 2011 to MHADA and sought permission to sell the sales portion of the flats without specific permission of MHADA for each such sale. Reason for the same was given as not to create liability to MHADA and to raise funds to complete the project. However, examination of sale documents revealed that stamp duty and registration was paid on each such transaction by the developer. There was, therefore no loss to MHADA if MHADA waiver was taken on individual sale permission. Once the conditional permission of MHADA was received for sale of flats (with condition that OC shall be given only after handover of Rehab component to MHADA), M/s Guruashish sold the FSI (not flats as mentioned in the letter) to various builders and received Rs 1034 crores from the builders. They also sold certain flats directly to home buyers and pocketed that money also," ED has alleged.

The agency further claimed that, after receiving the money surreptitiously, rather than to invest the money thus received in the Patra Chawl project, M/s Guruashish siphoned off the money and the project remains incomplete till date. "Thus the tenants, MHADA and the builders who purchased the FSI and flat buyers were all cheated by M/s Guru Ashish," the ED claimed.

Read Also

FPJ-Ed: Students of Christu Jyoti Convent School in Ujjain selected for ISRO’s Space Challenge