ED arrests ex-promoter of Bharat Papers in Rs 200 crore loan fraud case

Directorate of Enforcement (ED) has arrested Anil Kumar Aggarwal, director of Bharat Papers Limited on 06 February 2024 under the provisions of Prevention of Money Laundering Act (PMLA), 2002 in a bank loan fraud amounting to Rs 200 Crore.  Anil Kumar Aggarwal was produced before the special PMLA court, Jammu on 07 February 2024. The court has granted custody to ED till 13 February 2024.

ED initiated investigation on the basis of FIR registered by CBI against Bharat Papers Limited and its directors Rajinder Kumar Aggarwal, Parveen Kumar Aggarwal, Anil Kumar and Baljinder Kumar Aggarwal. The FIR alleged that Bharat Papers Limited and its directors have committed a bank loan fraud involving an amount of Rs 200 crore. The promoters of the company had taken the loan amount from a consortium of banks led by State Bank of India, J&K Bank, PNB and Karur Vysya Bank.

ED investigation revealed that Anil Kumar Aggarwal in his capacity as one of the main directors of Bharat Papers, since its incorporation in 2006, has committed the offence of money laundering by siphoning off part of the loan through bogus entities & related entities, illegal sale of machinery by raising fake invoices, selling scrap (machinery) out of books to unrelated entities and adjusting sundry debtors in the books of holding company.

Earlier, ED had conducted search operations on 31 January 2024 & 05 February 2024 at multiple locations spread over Jammu and Kashmir, Punjab and Uttar Pradesh including office/residential premises related to the present/past directors of Bharat Papers Limited, International Traders and Choudhary Industrial Projects Pvt Ltd, which resulted in seizure of Indian Currency of more than Rs. 34 lakhs, around 600 grams gold and various incriminating documents in the form of property documents, hard disk, digital device and digital evidence.

Chandigarh-based Bharat Papers is undergoing corporate insolvency resolution process. The company, which is engaged in manufacturing of papers and paper products, was dragged to insolvency court by J&K Bank for defaulting on a payment of Rs 98 crore.

The company owes Rs 892 crore to its creditors. The CIRP is being overseen by Sumat Kumar Gupta, who is the resolution professional in the case.

Also See: ED conducts raids at Bharat Papers premises across three states