In a case involving the embezzlement of NHAI funds, the Directorate of Enforcement (ED) conducted search operations under the PMLA, 2002 on October 16, 2023, at the offices of M/s. Bharat Road Network Limited (BRNL) in Kolkata, M/s. Guruvayoor Infrastructure Private Limited (GIPL) in Kolkata, M/s. KMC Constructions Ltd in Hyderabad, and M/s. GIPL office in Thrissur.
The ED opened an investigation based on a formal complaint (FIR) filed by the CBI under various sections of the Indian Penal Code, 1860, and the Prevention of Corruption Act, 1988 against M/s. Guruvayoor Infrastructure Pvt. Ltd. (GIPL) and others. The complaint claimed that between 2006 and 2016, the company, along with its Director Vikram Reddy, conspired criminally with unidentified officials of NHAI, Palakkad, to carry out work related to two sections of National Highway 47. This work was completed between 2006 and 2016, and the government of India was defrauded of approximately Rs. 102.44 crore.
The results of the ED investigation showed that the accused business, M/s Guruvayoor Infrastructure Private Limited (GIPL), and the subcontractor, M/s KMC Constructions Limited, along with NHAI officials and the project’s independent engineer, had received the road project’s completion certificate unlawfully and had begun collecting toll from the general public. The investigation has shown that the accused company illegally made money by renting out the ad space even though the bus bays were not yet finished. According to the PMLA of 2002, the accused thus received an unfair benefit of Rs 125.21 Crore, which is the value of the job that was not completed and the profits of the crime.
It was discovered during the investigations that M/s GIPL had invested the toll collections into mutual funds without paying NHAI for the work that had not been completed. As a result, a freezing order was issued under Section 17(1-A) of the PMLA, 2002, for a sum of Rs. 125.21 crore against M/s. Guruvayoor Infrastructure Private Limited’s fixed deposits and bank balance in Kolkata.
Additionally, searches resulted in the confiscation of incriminating documents from M/s. KMC Constructions Limited’s office space. These documents showed that the company had sold M/s. Guruvayoor Infrastructure Private Limited (GIPL) to M/s. Bharat Road Network Limited (BRNL) for 51% of its shares without conducting a proper valuation or obtaining the required NHAI approval in accordance with the terms of the contract. As a result, a freezing order was issued against M/s KMC Constructions Limited’s bank balances of Rs. 1.37 crore in accordance with PMLA, 2002, § 17(1-A). Further research is now being conducted.
