Bank loan

Assets of Spices company seized by ED following JK bank loan fraud

Assets worth over Rs 145 crore of a Bengaluru-based spice company in a money laundering investigation linked to alleged loan fraud at J&K Bank have been seized by the Management of application (ED) attached

The agency said in a statement on Wednesday that a factory building, shops, apartments and land of the company, SA Rawther Spices Pvt Ltd, and others have been temporarily seized under the Law on prevention of money laundering (PMLA).

The total value of the attached properties is Rs 145.26 crore, he said.

The ED case stems from an FIR filed by the JK Police Anti-Corruption Bureau against the company and its promoter manager Syed Anish Rawther, then manager of the J&K Bank branch located at BU Infantry Road in Bengaluru and other officials from the same bank. , in August 2019.

“In the FIR, it was alleged that SA Rawther Spices Pvt Ltd had defaulted on a loan and was declared NPA (non-performing asset) in September 2017. A net amount of Rs 285.81 crore was outstanding with the company in addition unapplied interest of Rs 66.91 crore against mortgaged collateral property of Rs 171 crore,” the ED said in a statement.

During the same period, he said, the company “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 to J&K Bank Ltd”.

“The then branch manager (of J&K Bank) in connivance with the promoter/director of the company caused a loss to the state treasury in the amount of Rs 352.72 crore,” the agency claimed. .

The company got several loans and used them to export goods mainly to related parties and the export earnings were never realized in India, she claimed.

“The company has also diverted funds to sister companies/groups by adjusting their outstanding export invoices by releasing new packaging credit, inland letters of credit (ILC) to relationships with sister companies through hosting of invoices under the cover of ILC.”

“It was found that SA Rawther Spices Pvt Ltd took advantage of J&K Bank’s Packaging Credit Loans and used them to service installments to the term loan account of Central Trade Agency Pvt Ltd., which is a sister company to the old company,” he said. .

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