The Enforcement Directorate (ED) has provisionally attached residual plant & machinery at the site, building structures and more than 200 acres of land of M/s Jalna Sahakari Sakhar Karkhana Ltd. at Jalna under the provisions of the Prevention of Money Laundering Act (PMLA) in a case relating to illegal sale of Cooperative Sugar Mills (Sahakari SakharKarkhana) (SSK) in Maharashtra State Co-operative Bank (MSCB) case. The SSK, claimed the ED, is linked to Shiv Sena leader Arjun Khotkar who had served as an MLA from Jalna and as a minister in the Maharashtra government between 2016 and 2019.
The assets of M/s Jalna SSK is currently held in the name of M/s Arjun Sugar Industries Pvt. Ltd. ED has initiated investigation under the PMLA based upon an FIR registered on August 26, 2019 by Economic Offence Wing, Mumbai Police. The said FIR was registered in pursuance of the order of the Bombay High Court. It has been alleged in the said FIR, that the cooperative SSKs were fraudulently sold by the then officials & Directors of MSCB at throw-away prices to their relatives/private persons without following the due procedure prescribed under the SARFAESI Act.
"Investigations conducted under PMLA revealed that M/s Jalna SSK Limited was established in the year 1984-85 on around 235 acres of land including 100 acre of land received without any monetary consideration from Maharashtra Government. The Jalna SSK failed to repay the loan availed from MSCB and was declared as NPA on 31.03.2002. There was a loan outstanding of Rs 33.49 crore of MSCB on Jalna SSK as on 30.09.2008. To recover its dues, MSCB took possession of the said SSK on 16.02.2009 under SARFAESI Act," the ED claimed in a statement.
"Thereafter, MSCB conducted an auction of M/s Jalna SSK on 27.02.2012 with reserve price of Rs. 42.18 crore. Only two parties - M/s Tapadia Constructions Pvt. Ltd., Aurangabad and M/s Ajeet Seeds Pvt. Ltd, Aurangabad participated in the said auction. M/s Tapadia Constructions Pvt. Ltd., Aurangabad was the highest bidder who bidded for Rs. 42.31 crore whereas other bidder i.e. M/s Ajeet Seeds Pvt. Ltd. bidded below the reserve price. Investigation also revealed that the buyers of bid documents and final participants in the auction were linked to each other and M/s Tapadia Constructions Pvt. Ltd & M/s Ajeet Seeds Pvt. Ltd are operating from the same building in Jalna," the ED's statement claimed.
"After receipt of final installment of sale amount by MSCB, sale certificate was also issued to M/s Tapadia Construction Pvt. Ltd on the same day on December 03, 2012. M/s Tapadia Constructions Pvt. Ltd did not operate the SSK and after a lapse of 15 months, the SSK along with 235 acres of land located in Jalna was said to be sold to M/s Arjun Sugar Industries Pvt. Ltd. M/s Arjun Sugar Industries Pvt. Ltd. is a Company incorporated by Arjun Khotkar and others only with a view to purchase the Jalna SSK Ltd. on 08.05.2012," the agency claimed.
"Investigation under PMLA also revealed that Arjun Khotkar was on the Board of Director of Maharashtra State Co-op Bank Ltd. during the period from 1998-2004. He was director in Jalna SSK during the period from 1997 to 2003. Further, he is an elected chairman of APMC, Jalna since 2007 to till now. Further he has been a director in DCCB, Jalna for the period from 1997-2004 and from 2017 till now. PMLA investigation further revealed that around Rs.10.56 crore paid by M/s Tapadia Construction Pvt. Ltd. to MSCB as initial deposit in lieu of Jalna SSK was an adjustment entity introduced by conversion of cash through shell companies. Further, Rs 31.73 crore was sourced from M/s Arjun Sugar Industries Pvt. Ltd on 03.12.2012. Thus M/s Tapadia Constructions Pvt. Ltd was only a proxy entity which had purchased Jalna SSK Ltd from MSCB as a proxy for others," the agency claimed.
"Investigation further revealed that M/s Jalna SSK was sold for an amount of R 42.31 crore by suppressing the value, whereas the valuation of the assets conducted by independent valuer appointed by ED revealed that the value of M/s Jalna SSK was around Rs 78 crore at the material time. The Govt. approved valuer has submitted his Valuation Report dated 20.01.2022 to ED evaluating the immovable assets for Rs 48.38 crore and movable assets was Rs 30 Crore of Jalna SSK in the year 2012. PMLA investigation also revealed that the valuable & crucial equipment of the SSK such as boiler was sold as scrap by Arjun Sugar Industries Pvt. Ltd. It is pertinent to mention that District Collector office to stop the unauthorized sale of the Government land to private entity initiated action and Sub-Divisional Officer, Jalna declared registry of Government land to M/s Tapadia Construction Pvt. Ltd. as null and void vide order dated 12.04.2018," claimed ED in the statement.
"ED investigation revealed the fraudulent mode and manner in which the bidding process was followed for sale of SSK and subsequent distribution of assets of SSK among family based business entity of member of MSCB indicates sale of SSK and accordingly the properties of said SSK which includes Government land of several acres, plant & machinery, Building & Structure which was acquired illegally (now owned by M/s Arjun Sugar Industries Pvt. Ltd) are being proceeds of crime are provisionally attached under PMLA. It may be mentioned that the said SSK has remained closed from that time," the statement concluded.