ED searches in Rs 346-cr bank 'fraud' case

New Delhi, Sep 10 (PTI) The Enforcement Directorate (ED) on Wednesday conducted searches in Delhi-NCR, Tamil Nadu and Karnataka in a money laundering investigation linked to an alleged Rs 346 crore alleged bank fraud case by a Haryana-based power sector company and its promoters, official sources said.

The probe is against Gurugram located Hythro Power Corporation Ltd (HPCL), which is under liquidation, and its directors Amul Gabrani and Ajay Kumar Bishnoi apart from some others.

The ED case, filed under the Prevention of Money Laundering Act (PMLA), stems from a February 2025 CBI FIR where the promoters are alleged to have "siphoned off" the loan funds to some of their linked entities causing losses to the banks.

The Gurugram zonal office of the ED conducted searches at five premises in the national capital region, three in Chennai and one in Bengaluru as part of this probe, the sources said.

As per the case details, alleged frauds declared by the complainant banks amounts to Rs 346.08 crore, including Rs 168.07 crore by the PNB, Rs 77.81 crore by the ICICI Bank, Rs 44.49 crore by Kotak Mahindra Bank and Rs 55.71 crore by the Union Bank and the fraud is alleged to have taken place between 2009 and 2015.

HPCL, a power transmission and distribution sector company, was engaged in designing, manufacturing, and constructing turnkey projects for power transmission lines.

It is alleged that the promoters and directors of the company obtained credit facilities from the Punjab National Bank (PNB), the lead bank of the consortium, worth a total Rs 165.71 crore under a multiple banking arrangement.

Despite several restructurings, including conversion of invoked bank guarantees into funded interest term loans (FITL), HPCL "defaulted" and was declared a Non-Performing Asset (NPA) on March 31, 2015, and later reported as a "fraud" to the RBI on June 13, 2024, the ED said.

A forensic audit found that the funds were "siphoned" through transactions with group companies such as Avadh Transformers, G.E.T. Power, Revolution Infocom, TecproEngg and others through "fictitious" job work, unpaid receivables, and circular transactions.

Several large advances and sale invoices remained unrecovered for years, indicating non-genuine trade dealings. HPCL used related entities to divert funds and misappropriate assets, leading to erosion of creditor interests, the agency alleged. PTI NES DV DV