The ED has taken up an investigation based on half a dozen FIRs issued by the CBI against them for allegedly cheating banks.
Published Jun 14, 2023 | 8:25 PM ⚊ Updated Jun 14, 2023 | 8:26 PM
Enforcement Directorate.
The Enforcement Directorate (ED) on Wednesday, 14 June, arrested Deccan Chronicle Holdings Limited (DCHL) promoter T Venkattram Reddy and two others in connection with the alleged bank fraud case.
Two other persons arrested by the ED include former director PK Iyer and statutory auditor Oommen. Reddy, Iyer, and Ommen were arrested on charges of money laundering.
The ED initiated an investigation based on half a dozen FIRs registered by the CBI against them for allegedly cheating banks.
Before the arrest of Venkattram Reddy, the ED attached the properties belonging to the company in different parts of the country, especially in Chennai and Hyderabad.
Sources said the total fraud allegedly committed by arrested persons and others would be to the tune of ₹8,000 crore, including interest.
The agency said in 2020 that its probe found that “the three promoters of DCHL, namely PK Iyer, T Venkattram Reddy, and T Vinayakravi Reddy, hatched a well-planned conspiracy and manipulated the balance sheets of the company inflating the profits-advertisement revenue and grossly under-stated the financial liabilities of the company to paint a rosy picture for years to cheat the banks and its shareholders”.
The company, at that time, was stated to be undergoing the corporate insolvency resolution process.
A resolution plan for only ₹400 crore was approved by the National Company Law Tribunal.
The total loan fraud committed by DCHL and its promoters is estimated to be at ₹8,180 crore, the agency said back then.
The ED filed a Prevention of Money Laundering Act case against the firm and its promoters in 2015 after studying a CBI FIR registered to investigate the alleged bank loan default.
The probe agency arrested Venkattram Reddy following a July 2013 complaint by the Secunderabad branch of Canara Bank.
The complaint by the bank alleged non-repayment of loans by them. It also offered a one-time settlement to the company in July 2014, the alternative to which was legal action.
According to a report by The Indian Express, the CBI registered an FIR against Venkattram Reddy and DCHL for cheating and criminal conspiracy on 9 July, 2013, which was the first of its six FIRs against them.
The bank also accused him and the company’s auditors of cheating it by submitting fake financial statements and concealing liabilities and borrowings from other institutions.
(With PTI inputs)
