In the bank fraud case, the Directorate of Enforcement (ED) temporarily seized moveable and 290 immovable properties worth Rs 63.05 crore that belong to M/s G S Oils Limited and its affiliated firms. In this case, a second order for a provisional attachment has been issued.
Based on an FIR filed by the CBI, BS&FC, Bangalore under different sections of the IPC 1860 against M/s G S Oils Limited, its related firms, and its directors for defrauding and inflicting undue loss to the former State Bank of Hyderabad, ED launched a money laundering probe (presently State Bank of India).
According to the ED investigation, M/s G.S.Oils Limited had taken use of a number of credit options from SBH and UCO Bank, including cash credit, term loans, and LCs. Due to the fraud committed by the defendants, all such credit facilities have been NPA. Loans were recirculated and parked in a number of associate firms, after which they were either withdrawn in cash or used to buy land banks in the names of the associate companies, which were then mortgaged once again for more loans.
It is also discovered that significant sums of money belonging to the bank were stolen by issuing LCs to connected shell companies for a fictitious delivery of materials. Such LCs were devolved, the aforementioned money was forcibly returned to their promoters, and as a result, the PSU banks suffered huge financial losses.
The entire amount of Proceeds of Crime that M/s G.S. Oils Limited has obtained is Rs 306.33 Crore. On September 29, 2017, ED issued the first provisional attachment order, and a prosecution complaint was also submitted. A current attachment order has been issued, tying up the accused company’s equipment and machinery, as well as agricultural lands in Adilabad totalling around 2050 acres, to additional assets that were utilised to get loans from banks. More research is being done.
