The agency provisionally attached the assets under Prevention of Money Laundering Act (PMLA) in the form of balance in bank accounts and immovable assets like land, plant and machinery, and the power plant of the company situated at Sagma village in Madhya Pradesh's Satna district.
The ED had initiated the investigation in the case on the basis of an FIR registered by the Central Bureau of Investigation (CBI) against KSSPL, its directors and promoters, and others under charges of criminal conspiracy and Prevention of Corruption Act.
The CBI in 2014 had filed a closure report in the case before a special CBI judge at Delhi's Patiala House Courts but the court did not accept it and took cognisance of the offence against KSSPL, its managing director Pawan Kumar Ahluwalia and others.
Investigators said Thesgora-B/Rudrapuri Coal Block was allocated jointly to KSSPL and Rewti Cements Pvt Ltd in November 2008 by the Coal Ministry.
The KSSPL while submitting application of allotment of coal block had mis-represented their net worth and production capacity in order to embellish its claim for the purpose of favourable recommendation for allocation of coal block.
The Supreme Court on August 25, 2014, had ordered cancellation of allotment of coal blocks including the one allotted to the KSSPL.
"After applying for allocation of coal block, KSSPL received share application money amounting to Rs 86.469 crore during 2007-2008 to 2010-2011 from the different companies and individuals, out of which they refunded Rs 17.67 crore to some investors," an ED statement said.
It said the share application money received was used by the KSSPL for re-payment of term loan and other loans.
"KSSPL issued shares of face value of Rs 100 per share at par as well as at a premium of Rs 900 and issued shares for Rs 32.175 crore and did not allot shares for the remaining amount."
"The KSSPL received very high premium only because it had very high probability of getting coal block after misrepresenting the net worth and production capacity, which were relevant criteria for allocation of coal block. During 2007-08 to 2009-10, the company had issued shares at the premium of Rs 900 per share whereas the trend of earning per share was not only insignificant but also decreasing.
"Further, the shares issued at the premium of Rs 900 per share to 33 different investors were further purchased by a different companies at value of mere Rs 25 per share. Thus, the KSSPL gained pecuniary undue benefit of Rs 32,175 crore as share application money and share premium which is the part of the proceeds of crime derived as a result of criminal activity relating to the schedule offence," the statement said.
(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)
Doraiah Chowdary Vundavally is a Software engineer at VTech . He is the news editor of SocialNews.XYZ and Freelance writer-contributes Telugu and English Columns on Films, Politics, and Gossips. He is the primary contributor for South Cinema Section of SocialNews.XYZ. His mission is to help to develop SocialNews.XYZ into a News website that has no bias or judgement towards any.
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