Supreme Court allows M3M's plea to substitute land of real estate company, attached under PMLA
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Mint
an hour ago
- Mint
OctaFX case: Luxury yacht, minijet boat, cars and other assets of Pavel Prozorov worth ₹131.45 cr attached by ED
The Enforcement Directorate's (ED) Mumbai office has attached properties valued at ₹ 131.45 crore from Russian Pavel Prozorov, including a luxury yacht and assets in Spain, as part of the probe into OctaFX's unauthorised forex trading under the Prevention of Money Laundering Act (PMLA), 2002. A release by ED on July 3 stated, 'These assets belong to Pavel Prozorov, the mastermind behind the platform OctaFx. The assets include movable properties in the form of a luxury yacht, a minijet boat, luxury car and immovable properties in the form of two residential properties in Spain. The luxury Yacht goes by the name – 'Cherry' is an Italian model commercial yacht cruising in the Western Mediterranean.'
Time of India
2 hours ago
- Time of India
Insolvency proceedings cannot sidestep PMLA process: NCLT
Proceedings under the Insolvency & Bankruptcy Code cannot be used as a mechanism to "frustrate or sidestep" the process going under the Prevention of Money Laundering Act , the National Company Law Tribunal (NCLT) said. Rejecting the plea for dissolution of Shakti Bhog Snacks , which is under the lens of the Enforcement Directorate (ED) with a special PMLA Court taking cognisance of the complaint filed by the probe agency, NCLT said it "would amount to judicial overreach ". This will also "impair the ED's ability to complete its investigation, pursue trial, and recover proceeds of crime," said NCLT while dismissing the plea of the Resolution Professional of Shakti Bhog Snacks. A two-member NCLT bench further said the Supreme Court has already held that NCLT and the appellate tribunal NCLAT do not have jurisdiction to interfere with proceedings or orders passed under the PMLA, including attachment orders or criminal prosecution. "In view of the foregoing, we are of the considered opinion that permitting dissolution despite the pendency of the Special Court's cognizance over the Corporate Debtor would amount to judicial overreach and would impair the ED's ability to complete its investigation, pursue trial, and recover proceeds of crime," said a 14-page-long order by NCLT. Live Events NCLT cannot assume jurisdiction in a manner that would render Shakti Bhog Snacks unavailable for criminal liability, particularly when it stands named as an accused, and assets, however meagre, are under attachment. "It is not the quantum but the character of the proceedings that is determinative," said the NCLT bench comprising Members Sanjeev Ranjan and B V Balram Das. Shakti Bhog Snacks Ltd (SBSL) is the group company of Shakti Bhog Foods Ltd (SBFL), which was once a leader in the wheat flour segment. Insolvency proceedings against SBSL were initiated by NCLT in January 2023 after default was established by one of its operational creditors. It also appointed an interim resolution professional, who also formed the Committee of Creditors (CoC) as per the provisions of the IBC. However, RP could not get control of SBSL's physical assets and records as it was sealed by the Enforcement Directorate. Moreover, the company was not in operation. No person was available, and its land and building situated at Noida were already sold by the State Bank of India under the SARFAESI Act. Moreover, in CoC, SBI was the sole member, and it could not even liquidate SBSL due to the absence of assets, records, operations, and personnel. The CoC recommended dissolution of SBSL instead of liquidation and the RP approached NCLT, filing plea under Section 54 of the IBC for dissolution. NCLT on August 20, 2024, issued notice to the Registrar of Companies, Income Tax Department and others. After that, ED filed its reply before NCLT, opposing the dissolution of Shakti Bhog Foods, in view of the ongoing proceedings under the Prevention of Money Laundering Act, 2002 (PMLA). ED submitted that SBFL defaulted in repaying its loan obligations, and its account was classified as NPA and total outstanding dues to the consortium of banks stand at approximately Rs 3,269.42 crores as on 31.03.2020. ED submitted before NCLT that investigation revealed that Shakti Bhog Snacks, along with Shakti Bhog Foods was involved in the activities related to money laundering. SBSL acquired and possessed proceeds of crime to the tune of Rs 97.87 crore from six group entities of SBFL, the probe agency submitted before the insolvency tribunal. It transferred Rs 127.81 crore to these six group entities from FY'08 to FY'15 in the guise of investment and sale-purchase. The name of Shakti Bhog Snacks was used by Shakti Bhog Foods to rotate its loan funds against bogus invoices. The company layered and siphoned off the proceeds of crime received from Shakti Bhog Foods and further transferred them to the directors/promoters and their relatives. "The ED further submitted that SBSL carried out these transactions without any actual movement of goods. The group companies of SBFL involved in these transactions were shell entities, and no genuine business activities were conducted therein," said NCLT order while recording ED's submission. These transactions were carried out to inflate the financials of SBFL so that more credit facilities could be availed from banks," it said. Consenting to it, NCLT said: "Dissolution under Section 54 of the IBC results in the Corporate Debtor ceasing to exist as a legal entity. Such a consequence would inevitably frustrate the ongoing criminal prosecution under the PMLA and defeat the authority and jurisdiction of the Ld. Special Court, which is statutorily vested with the power to try offences under the PMLA and adjudicate upon related attachments and confiscation proceedings," it said.
Hans India
9 hours ago
- Hans India
National Herald case: Congress may face charges says ED
New Delhi: In a significant development in the National Herald money laundering case, the Enforcement Directorate (ED) has told Delhi's Rouse Avenue Court that if concrete evidence emerges, the Congress party could be named as an accused under Section 70 of the Prevention of Money Laundering Act (PMLA). However, the agency clarified that such a step would not be taken without sufficient proof. The ED emphasized that not naming the Congress party as an accused at this stage does not rule out the possibility of doing so in the future. The court is scheduled to continue hearing the matter on July ED also noted that both Rahul Gandhi and Sonia Gandhi have not fully cooperated during the investigation, allegedly shifting the responsibility onto the late Congress leader Motilal Vora. Presenting arguments on Wednesday, Additional Solicitor General SV Raju, representing the ED, laid out the agency's case in detail. He said that Young Indian Pvt Ltd acquired Associated Journals Limited (AJL), which holds assets worth approximately ₹2,000 crore. According to the ED, the acquisition was part of a larger conspiracy. Raju explained that the formation of Young Indian was specifically intended to take over AJL. He cited a letter written by an AJL director to Congress, in which it was stated that the company was unable to repay its loan due to discontinued publication and lack of steady income. According to the ED, Sonia Gandhi, Rahul Gandhi, Suman Dubey, and Sam Pitroda held key positions in Young Indian. 'They were the beneficial owners,' Raju argued. The agency claimed that AJL, a company with ₹2,000 crore in assets, was taken over for just ₹90 crore, and even that loan was later written off for only ₹50 lakh.
