ED attaches assets worth Rs 80.65 crore belonging to TRS MP Nama Nageshwar Rao

The Enforcement Directorate (ED) on Monday attached 28 immovable properties and other assets worth Rs 80.65 crore belonging to TRS MP Nama Nageshwar Rao and his family members in an ongoing money laundering case against Ranchi Expressway Ltd and Madhucon Projects Limited.
 
Ranchi Expressway Ltd was floated by the Madhucon Group, which is owned by Rao and his family. Ranchi Expressway had taken a loan to complete a project awarded by the National Highways Authority of India (NHAI) but it defaulted, and the probe agency alleges that funds were diverted and money was routed back to the Madhu Group.  
 
Nageshwar Rao is the promoter and director of Madhucon Group and a personal guarantor of the bank loan to Ranchi Expressway. Today, the ED said that it has attached the registered office of the group and residential property at Jubilee Hills, Hyderabad.
 
In July this year, the ED provisionally attached 105 immovable properties and other assets worth of Rs 73.74 crore belonging to Madhucon Group and its directors and promoters. The attachments came after multiple raids and recording statements of promoters, sub-contractors, bankers, engineers, and forensic auditors.
 
The ED has found that the Madhucon Group promoters siphoned off the loan funds of this project by taking the entire contract from its SPV (Special Purpose Vehicle) and then taking huge mobilisation and material advances, but instead of using those advances for the work, used it in their other projects, the agency said in a statement.
 
Also, the agency said, direct cash of amount Rs 75.50 crore was generated by paying money and then receiving back the amount through 6 shell entities (Usha Projects, Shree BR Visions, Sri Dharma Sastha Constructions, Sree Nagendra Constructions, Ragini Infrastructure, and, Varalakshmi Constructions) which were completely under the control of Nageshwara Rao and Nama Seethaiah.
 
“These sub-contractors did no work, had no sufficient expertise, were based in AP and Telangana, whereas the project was in North India, and they took large advances from MPL from the loan funds and then paid back huge amounts to Madhucon Group on the pretext of using the equipment and labour of Madhucon Group…so the funds came back to the Madhucon Group,” the ED said.
 
The probe agency further said that it has identified a direct diversion of Rs 361.29 crore from the bank loan obtained by Ranchi Expressways Limited.