Team News Riveting
New Delhi, July 5
The Enforcement Directorate (ED) has arrested Shakti Bhog Foods Limited, its Managing Director Kewal Krishna Kumar in a money laundering case.
“The arrest was in continuation of a search that was carried out at nine premises located in Delhi and Haryana,” ED said in a statement. During search, various incriminating documents and digital evidence have been recovered.
The ED initiated the money laundering investigation based on the FIR registered by the CBI that filed a case against Delhi-based Shakti Bhog Foods Limited, its Managing Director Kewal Krishna Kumar, directors Sunanda Kumar and Siddharth Kumar and unknown public servants on allegations of a bank fraud over Rs 3,269 crore.
The State Bank of India (SBI) had lodged a complaint. CBI conducted searches at eight locations in Delhi, at the official and residential premises of the accused, which led to the recovery of various incriminating documents as part of an ongoing probe.
SBI and other consortium member banks have accused Shakti Bhog of criminal conspiracy, cheating, forgery of valuable security and forgery for the purpose of cheating. Banks have claimed that Shakti Bhog’s top officials siphoned off public money by falsifying accounts and forging documents.
The complaint claims that Shakti Bhog showed damage to an inventory of Rs 3,000 crore due to pests, in its forensic audit of Financial Year 2015-16, which led to its sale at a low price. However, banks claim that the stock and receivable audit report of the firm showed that the company’s warehouses had a stock of over Rs 3,500 crore in 2015, where none of the inventory was slow-moving or obsolete.
SBI’s complaint has claimed that Shakti Bhog’s account turned NPA due to inventory losses, “Owing to a steep fall in paddy prices, underutilisation of Capex in rice and paddy segments in last two years and a delay in the tie-up funds (PE investment) to tide over losses.”
On March 31, 2020, the total outstanding dues against Shakti Bhog were Rs 3,269 crore which included an outstanding Rs 1,903 crore to SBI.
