On a day when a special court remanded former PWD Minister Chhagan Bhujbal to its custody till March 17, the Enforcement Directorate (ED) on Tuesday charged that Bhujbal, his family members and associates had caused a loss of staggering Rs 887 crore to the State exchequer.
In a remand application which alleged that “Prima facie there is generation of huge illicit funds and its laundering by the family members and associates of Chhagan Bhujbal”, the ED referred to the statements of Sunil Karve, the NCP leader’s former charted accountant and a few market operators close to the NCP leader’s family who have spilled the beans on the financial dealings of Bhujbals in his recorded by the agency.
Karve and others, who deposed before the ED, have among other things told the agency that shares of Messrs Parvesh Constructions Pvt ltd and Messrs Armstrong Energy Pvt ltd — the two firms owned and controlled by Bhujbals — were sold to dubious entities against cash at unrealistic high premium of Rs 9,900 per share and funds to the tune of Rs 75 crore and Rs 50 crore respectively were channelled by this method. The cash was handed over to the said operators at the office of the Mumbai Education Trust (MET), an educational institution run by the Bhujbals at Bandra in north-west Mumbai. The dubious transactions were entered into from the year 2006 onwards.
Throwing light on the allegedly dubious functioning of the firms owned by Bhujbals, the ED told the court that the “so-called” Directors of the entities controlled by the Bhujbals were employees of MET like the accountant at MET, the executive assistant to trustees of MET, the wife of the accountant of MET, liaisoning officer, clerk in MET, wife of the executive assistant to trustees of MET, accountant of M/s Parvesh Construction Pvt ltd, family friends, ex-employees of MET and even a driver of MET. All the above deposed and said that they were only signatory directors of the said companies and used to sign documents at the behest of the Bhujbals.
According to the remand application, it has come to light during the investigations that the contractor of Maharashtra Sadan and RTO project, Messrs K S Chamankar Enterprises had paid Rs 6.03 crore to Messrs Origin Infrastructure Pvt ltd an entity controlled by Bhujbals. Further, Messrs. Prime Builders and Developers to whom Messrs Chamankar Enterprises had sub-let the project paid Rs 18.50 crore through their associates against dubious real estate deals.
The investigations have so far established money trial involving the web of companies some on paper and some of them being non-existent, instead of co-operating with the investigating authorities.
While seeking the remand of the custody of Bhujbal who was arrested on Monday night under Section 19 (1) of the Prevention of Money laundering Act, ED counsel Hiten Venegaonkar told the court that the senior NCP leader did not cooperate the ED recorded his statement on Monday. “For most of the questions put to him, his answer was ‘he doesn’t know’,” Venegaonkar told the court.
In its remand application, the ED said that Bhujbal had so far maintained “deliberate silence” about the modus operandi adopted by him to favour the contractor and especially the origin of the cash which has been circuitously routed through market hawala operators to receive the same back in cheques and through RTGS into the companies controlled by Pankaj and Sameer Bhujbal. “Thus, the cash generated has been consciously layered and attempted to be integrated into the main stream in order to obfuscate the money trial,” the ED told the special court in its application.
Among other things, the remand application stated the building in which Bhujbal is residing with nephew Sameer and son Pankaj had been attached. “The ownership and title of the said building is apparently in dispute which is presently controlled by M/s Parvesh Construction Pvt ltc whose shares have been sold to Kolkata based dummy companies at a premium of Rs 9900. Therefore the nexus with companies in laundering the proceeds of crime is clearly visible,” the application stated.
Bhujbal, whose alleged misuse of office as the former PWD Minister in the previous DF government is being investigated, was arrested on Monday night as part of the two Economic Case Information Reports (ECIRs) registered on June 17 against him, his son Pankaj and nephew Sameer others under the provisions of PMlA.
While Bhujbal’s nephew Sameer Bhujbal, a former NCP MP from Nashik, who was arrested by the ED in connection with a money laundering case, is currently in Arthur Road jail here under judicial custody, his son Pankaj has already been subjected to three rounds of questioning by the investigating officials.
Sameer was arrested by the ED on February 1 under various provisions of provisions of Prevention of Money laundering Act (PMlA) in a case of money laundering, siphoning off funds and causing a loss of Rs 840 crore to the exchequer, of which Rs 114 crores has reportedly been recovered.
In an application seeking Sameer’s remand filed before the city court, the ED had stated last month that funds were also laundered in the guise of purported sale of shares on high premium by channelling huge cash to the tune of approximately Rs 125 crore in banking transactions.
The Enforcement Directorate had made Sameer’s arrest as part of the two Economic Case Information Reports (ECIRs) registered on June 17 against former PWD Minister Chhagan Bhujbal, his family members and others under the provisions of PMlA.
The two ECIRs, registered against Chhagan Bhujbal, his son Pankaj, nephew Samir and 19 others, relate to the alleged illegal transactions to the tune of several hundred crores, under the provisions of PMlA. Between 2007 and 2011, Pankaj and Samir were directors of Parvesh Construction, a firm which executes redevelopment projects in Mumbai.
Bhujbal, his son Pankaj and nephew Samir had come under the State ACB’s scanner for the alleged irregularities in handing over the contracts to a developer close to Bhujbals, KS Chamankar for three projects that the PWD had handed to the latter while he was heading the ministry in the previous Democratic Front (DF) government.
On February 24, the State ACB formally registered a charge-sheet against Chhagan Bhujbal in a city court here the new Maharashtra Sadan scam case.