Nagpur: The Enforcement Directorate on Wednesday has attached the assets worth Rs 97 crores of two companies promoted by Nagpur based businessman Govind Daga, under Prevention of Money Laundering Act (PMLA). The ED sleuths also attached the assets worth Rs 17.7 crore of his Central Colleries Ltd. in a separate development. The company has also been linked to coal block allocation scam that rocked the former UPA government.
Sources informed that ED has attached his Mines Side company in Chandrapur. Similarly a flat owned by Daga in 24 Pargana district in West Bengal has also been attached by the ED officials. Daga’s partner Sunil Mal has also been made accused in the scam.
The ED in its statement has informed that the directors of Central Colleries have aquired the coal blocks by furnishing false information with the government. The company had bagged the Bellora-Takli block-2 (Takli Jena Bellora Block) in Chandrapur. The company had applied for it on January 5, 1998 where it submitted second application on February 12, 1998 in which it sought to establish a 30 MW power plant and washery.
Similarly BS Ispat has been promoted by a trio of city businessmen Daga, Mohan Agrawal and Nandkishore Sarda. Both the cases are basically related to the alleged coal block allocation scam of UPA regime investigated by the Central Bureau of Investigations (CBI).
This is the third city-based company named in coal scam whose assets have been attached. Last month ED attached properties worth Rs25 crore of Grace Industries headed by Mukesh Gupta. In BS Ispat, the promoters have been accused of misrepresenting facts for securing allocation of two coal blocks in Chandrapur district. After getting the blocks, the three promoters sold entire holding in BS Ispat to Oriental Castings Ltd (OCL) gaining huge profits. Technically, the company that was allotted the coal block remained the same on paper but the shareholders changed.
ED investigation pegged the gains out of the deal at Rs60 crore. Gains from allegedly illegal mining of coal have been fixed at Rs18 crore. The assets seized in this case include agricultural land, industrial plot, mutual funds and bank deposits. The major assets include mutual funds worth over Rs15 crore, banks deposits of Rs14 crore and investment in shares of other unlisted companies worth Rs11.65 crore.
Apart from assets in the company’s name, personal property worth Rs30 crore belonging to Dagas and Rs15 crore each to Agrawal and Sardas were also attached.
This was followed by action on Central Collieries Ltd, the company in which Daga is the promoter. A case of misrepresentation of facts and illegal sale of coal has been registered against the company. Central Collieries is alleged to have got a coal block allocation even before it was incorporated. The coal mined through the block was sold in open market instead of captive use.
The Rs17.7 crore assets seized in this case include a Rs4 crore flat in Kolkata and land at Bhadravati taluka of Chandrapur worth Rs9 crore.
A company spokesperson said the move would be challenged at all levels. In BS Ispat case, one of the defence taken by the company is that Daga, whose assets have been seized, has not been named in the CBI FIR. Normally ED takes over investigation on the basis of CBI probe which has not nailed Daga yet. About Central Collieries, the company says the sale of coal for which it has been charged, took place in 2004. That is one year before the PMLA Act came into force. The law cannot be enforced in retrospect, the spokesperson said.
