The Enforcement Directorate (ED) is probing the multi-crore school recruitment case in West Bengal. (File Image: News18)
GDR is defined as a negotiable financial instrument issued by a depository bank and enables a company to access investors in the capital market overseas.
The Enforcement Directorate on Friday said it has attached assets worth over Rs 59 crore belonging to a London-based Indian-origin individual (PIO) and some other entities as part of its money laundering probe related to the alleged Global Depository Receipts (GDR) scam.
GDR is defined as a negotiable financial instrument issued by a depository bank and enables a company to access investors in the capital market overseas.
These assets belong to London-based Arun Panchariya, Sanjay Agarwal and India Focus Cardinal Fund. In a statement, the ED said that a total of Rs 59.37 crore worth of assets have been attached in the probe related to Hyderabad-based Pharmax India Limited.
Pancharias and his associated entities such as London-based Pan Asia Advisors Ltd. (now known as Global Finance & Capital Ltd.), India Focus Cardinal Fund and Vintage FZE (“Vintage” – now known as Alta Vista International FZE) along with their associates such as Aggarwal, Jalaj Batra and others along with the promoters/directors of Pharmax India Ltd. Morthala Srinivasa Reddy and Morthala Malla Reddy Designed and executed a “fraudulent” GDR plan to “defraud and defraud the Indians”. investors”, the ED alleged.
As per the rules, when GDRs of an Indian company are subscribed abroad, it is mandatory to repatriate the proceeds to India, unless they are deposited abroad to meet future foreign exchange requirements.
However, in the case of Pharmax India Limited, GDR proceeds of US$ 71.91 million (equivalent to Rs 318 crore at the exchange rate prevailing at the time of issue of GDRs in June and August 2010) were not repatriated to India even though there were no actual future foreign exchange requirements, the ED said.
GDR amounting to US$ 56.57 million was received in the bank account of Pharmax India Limited in EURAM Bank, Austria, which was pledged as security against the loan availed by GDR client Vintage FZE.
The money laundering case stems from an FIR lodged earlier by the Telangana Police against the accused.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – PTI,