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MUMBAI: The Enforcement Directorate (ED) has attached assets of 50.20 crore belonging to the Aurangabad-based Kannad Sahakari Sakhar Karkhana (SSK), belonging to Rohit Pawar-led firm, Baramati Agro Private Limited (BAPL), as part of its money laundering probe related to the alleged illegal sale of sugar mills by the Maharashtra State Co-operative Bank (MSCB).

Pune, India – January 14, 2023: MLA Rohit Pawar in his office, at Hadapsar, in Pune, India, on Saturday, January 14, 2023. (Photo by Rahul Raut/HT PHOTO) (Rahul Raut/HT Photo)

NCP legislator Rohit Pawar, the BAPL’s chief executive officer and party chief Sharad Pawar’s grandnephew, was earlier questioned twice by the ED in the case. Pawar represents the Karjat-Jamkhed assembly constituency.

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Read here: ED attaches Sharad Pawar’s grandnephew Rohit Pawar’s properties worth 50 cr

Based on the investigation conducted and evidence collected under the provisions of the Prevention of Money Laundering Act (PMLA) in the case so far, ED’s probe established that the acquisition of Kannad SSK by M/s Baramati Agro Private Ltd was allegedly illegal and assets so acquired are proceeds of crime under the act, an ED official said.

Based on its findings, the agency thereafter issued a provisional attachment order under PMLA, attaching all the assets of Kannad SSK, worth 50.20 crore, the official said. The attached assets consist of 161.30 acres of land, plant and machinery and the sugar unit’s building. ED had initiated its investigation on the basis of a case registered by Mumbai police’s Economic Offences Wing (EOW) under various sections of the Indian Penal Code and Prevention of Corruption Act.

The police case had been registered in pursuance of an order of August 22, 2019 of the Bombay High Court. The police First Information Report had alleged that the state’s SSKs were fraudulently sold by the then officials and directors of the MSCB at “throw-away prices” to their relatives/private persons without following the due procedure.

ED’s investigation revealed that to recover an outstanding loan of 80.56 crore of Kannad SSK Limited, the MSCB had taken possession of all its assets on July 13, 2009, under the provisions of the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act. Further, on August 30, 2012, the MSCB had conducted an auction of Kannad SSK by allegedly fixing a very low reserve price based on a questionable valuation report, ED sources said.

Apart from BAPL, two other parties had entered into the bidding process, the sources said. The bidder with the highest bid was allegedly technically disqualified on flimsy grounds, whereas the other bidder was already a close business associate of BAPL, with no financial capacity or experience of running a sugar unit, ED sources said. Kannad SSK was eventually purchased by BAPL allegedly for around 50 crore.

BAPL is under the ED probe’s scanner for allegedly funding a co-bidder for complying with the requirement of submitting an Earnest Money Deposit (EMD) of 5 crore to participate in the auction, according to ED sources. The ED is also investigating whether BAPL used funds that were part of cash credit accounts of various banks sanctioned for the purpose of working capital requirements to purchase the sugar mill, an agency source said.

EOW meanwhile had in January filed a closure report—its second one since September 2020—in a city court in the alleged 25,000-crore MSCB scam case. The agency, while filing the closure report on January 20, said that nothing incriminating was found during its second probe, despite examining the points raised by the petitioners.

Earlier in this case, three provisional attachment orders were issued where assets acquired at 121.47 crore had been attached by ED. The ED had also submitted a main chargesheet and two supplementary chargesheets before a Mumbai special court in connection with its probe related to allegedly wrongful acquisition of 3 other SSKs. The court took cognisance of the three chargesheets.

Read here: ‘I am Sharad Pawar. I won’t spare anyone if threats continue’

Reacting to the development, Rohit Pawar posted on his X handle, “Action is being taken against me for speaking against injustice. Let them take action but they should also react to issues such as paper leak, unemployment and scams in government. BJP should remember those who were bowing down to it and cribbing have gone. Only those who are fighting are left now. We will fight and win.”

“The action against my factory is completely illegal and we will challenge it in the court. The way action is being taken means the code of conduct for elections would be imposed in a couple of days,” he added.

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