Truble For Anil Ambani: Troubles have increased for Anil Ambani’s Reliance Group, which is stuck in the bank loan fraud case. The Ministry of Corporate Affairs (MCA) has now started a new investigation amidst the already ongoing investigations by the central investigating agencies- ED, CBI and SEBI. The ministry has ordered an investigation into alleged misuse and misappropriation of funds in several group companies, such as Reliance Infrastructure, Reliance Communications, Reliance Commercial Finance and CLE Private Limited.
According to reports, the ministry’s preliminary investigation has indicated serious irregularities and large-scale embezzlement of funds under the Companies Act. On this basis, the case has now been handed over to the Serious Fraud Investigation Office (SFIO).
Investigation handed over to SFIO
The SFIO will now find out between which units of the group the funds were transferred, how the money flowed, and who had the role at the senior management level. Action will be taken after the investigation is completed. This step has come at a time when ED has intensified action against debt-ridden Reliance Group companies.
Earlier this week, the agency seized assets worth about Rs 7,500 crore of Reliance Group. These include 30 properties of Reliance Infrastructure and properties belonging to Adhar Property Consultancy, Mohanbir Hi-tech Build, Gamesa Investment Management, Vihaan43 Realty and Campion Properties. According to the ED, these attachments relate to the multi-crore bank fraud case involving Reliance Infrastructure.
Investigation on loan worth Rs 40,000 crore
The ED case focuses on loans taken by Reliance Communications (RCOM) and its affiliates between 2010 and 2012. According to the agency, the total outstanding is Rs 40,185 crore and five banks have declared these loan accounts as ‘fraud’.
Investigators say these funds were diverted to other group units, sent to related companies and used to repay old loans – a violation of loan terms. ED alleged that the money raised for business operations was used for “evergreening of debt” i.e. repaying old loans by taking new loans.
ED has said in its statement that between 2010 and 2012, RCom and its group companies collected thousands of crores of rupees from banks, out of which Rs 19,694 crores are still outstanding. These accounts have become NPA and five banks have declared them fraud.
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