The Enforcement Directorate (ED), Hyderabad Zonal Office, has successfully returned properties worth ₹79.20 crore to the State Bank of India (SBI) in a money laundering case linked to Musaddilal Jewellers and others.
SBI Filed Application for Restitution
Following the ED’s initiative, SBI filed a request under Section 8(8) of the Prevention of Money Laundering Act (PMLA), 2002, seeking the release of seized movable properties. The request was submitted to the Special PMLA Court, Hyderabad, urging the return of assets in the public interest.
Court Approves Release of Seized Jewellery
The Special Court, in its orders dated January 6 and February 3, granted permission to release jewellery worth ₹79.20 crore. The jewellery was seized from Musaddilal Jewellers’ commercial premises during the investigation.
ED’s Investigation into Money Laundering
The ED has been investigating Musaddilal Jewellers and its associates for allegedly depositing ₹111 crore in demonetised currency following the 2016 demonetisation. The probe revealed that the company created fake invoices for 6,000 non-existent customers, each showing transactions below ₹2 lakh, to justify the deposits.
Further investigation found that these funds were deposited in multiple bank accounts and used to purchase gold bullion, which was later sold. This process generated additional illegal profits amounting to ₹28 crore.
SBI’s Loan Exposure and ED’s Seizure
SBI had extended credit facilities to Musaddilal Jewellers, but the loans remained unpaid, leading the accounts to be classified as Non-Performing Assets (NPA) in July 2019. As of March 14, 2023, Musaddilal Jewellers owed SBI over ₹120 crore.
The ED had seized movable properties worth ₹83.30 crore during raids conducted on January 12, 2017, and April 15, 2019. Additionally, assets worth ₹130.57 crore, including both movable and immovable properties, were provisionally attached as part of the investigation.
ED’s Efforts to Combat Financial Crimes
The return of assets to SBI marks a crucial step in ED’s ongoing efforts to ensure that the Proceeds of Crime (PoC) are restored to their rightful claimants. The agency reaffirmed its commitment to fighting financial crimes and delivering justice to affected parties.
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