ED attaches assets of spices trading Co. in J&K Bank loan fraud case

29-09-2021: Enforcement Directorate has provisionally attached assets worth Rs. 145.26 Crore belonging to M/s S.A. Rawther Spices Pvt Ltd and others under the provisions of Prevention of Money Laundering Act, 2002 (PMLA).

The attached assets are immovable properties in the form of Factory buildings, shops, flats, and lands. ED initiated a money-laundering investigation on the basis of an FIR dated 06.08.2019 registered by the ACB, Srinagar, Jammu & Kashmir under sections of Jammu & Kashmir Prevention of Corruption Act, 2006 and Ranbir Penal Code (RPC), 1989 against Syed Anish Rawther, Promoter Director of beneficiary company M/s S.A. Rawther Spices Pvt Ltd and then branch head of J&K Bank BU Infantry Road Bengaluru and Officers/Officials of J&K Bank.

In the FIR, it was alleged that M/s S.A. Rawther Spices Pvt Ltd defaulted loan and declared NPA in September 2017. Net amount Rs 285.81 Crore was outstanding with the company besides the unapplied interest of Rs 66.91 Crore against the mortgaged collateral property of Rs 171 Crore. During the same period said the firm has also borrowed Rs 16.5 Crore from HDFC Bank and Rs. 25 Crore from RBL Bank and mortgaged the same property, which was already mortgaged with J&K Bank Ltd.

The then Branch Manager in connivance with promoter/director of M/s S.A. Rawther Spices Pvt Ltd have caused loss to state exchequer to the tune of Rs 352.72 Crore. Money laundering investigation, conducted by ED has revealed that M/s S.A. Rawther Spices Pvt Ltd obtained multiple loans and used the same to export goods mostly to related parties and the export proceeds were never realized in India. The company also diverted the funds to sister/group concerns by Adjustment of their Overdue Export Bills by releasing fresh packing credit, Inland Letters of Credit (ILC) towards dealings with sister concerns by way of accommodation of bills under the grab of ILC.

It is also revealed that M/s. S.A. Rawther Spices Pvt Ltd has availed Packing Credit loans from J&K Bank and used the same for servicing installments towards Term Loan Account M/s Central Trade Agency Pvt Ltd., which is a Sister concern of M/s. S.A. Rawther Spices Pvt Ltd.

Further investigation is in progress.