Rohit Pawar’s sugar factory seized by ED 

The Enforcement Directorate, Mumbai had attached 161.30 acres of land, plant & machinery and building structures of a sugar unit at Kannad, Aurangabad presently in possession of M/s Baramati Agro Ltd. worth Rs. 50.20 Crore under PMLA in a case related to illegal sale of Sugar factories by Maharashtra State Co-operative Bank to M/s Baramati Agro Ltd.

MLA Rohit Pawar has also raised questions about this on his X account.

As per further information from the press release of the Enforcement Directorate (ED), Directorate of Enforcement (ED), Mumbai has attached assets valued at Rs. 50.20 Crore of M/s Kannad Sahakari Sakhar Karkhana Limited (Kannad SSK) owned by M/s Baramati Agro Ltd under the provisions of the Prevention of Money Laundering (PMLA), 2002 in a case relating to illegal sale of sugar mills by Maharashtra State Co-operative Bank (MSCB). The attached assets consist of 161.30 acres of land, plant & machinery and building of the sugar unit in Kannad, Dist- Aurangabad.

ED initiated investigations on the basis of an FIR registered by Economic Offence Wing, Mumbai Police under various sections of IPC and of Prevention of Corruption Act. The said FIR has been registered in pursuance of the Order dated 22.08.2019 of the Hon’ble Bombay High Court. In the said FIR, it has been alleged that the SSKs were fraudulently sold by the then officials & Directors of MSCB at throw-away prices to their relatives/private persons without following the due procedure.

ED investigation revealed that to recover the outstanding loan of Rs. 80.56 Crore of M/s Kannad SSK Limited, MSCB took possession of all the assets of said SSK on 13.07.2009 under SARFAESI Act. On 30.08.2012, MSCB conducted an auction of Kannad SSK by fixing a very low reserve price based on a questionable valuation report. Apart from M/s Baramati Agro Ltd., 2 other parties entered into the bidding process. The bidder with the highest bid was technically disqualified on flimsy ground, whereas the other bidder was already a close business associate of M/s Baramati Agro Ltd. with no financial capacity or experience of running a sugar unit.

Based on the investigation conducted and evidences collected under PMLA so far, it has been established that the acquisition of Kannad SSK by M/s Baramati Agro Ltd was illegal and assets so acquired are proceeds of crime under the section 2(i)(u) of the PMLA, 2002. Accordingly, a Provisional Attachment Order under PMLA was issued attaching all the assets of Kannad SSK acquired for Rs.50.20 Crore.

Earlier in this case, 03 Provisional Attachment Orders have been issued where assets acquired at Rs. 121.47 crore have been attached. Further, 01 main Prosecution Complaint and 02 Supplementary Prosecution Complaints have also been filed before the Hon’ble Special PMLA Court, Mumbai for wrongful acquisition of 3 other SSKs. Hon’ble Court has already taken cognizance of all the prosecution complaints filed in this case.

Further investigation is under progress.

ED has posted a tweet regarding this “ED, Mumbai has attached 161.30 acres of land, plant & machinery and building structures of a sugar unit at Kannad, Aurangabad presently in possession of M/s Baramati Agro Ltd. worth Rs. 50.20 Crore under PMLA in a case related to illegal sale of Sugar factories by Maharashtra State Co-operative Bank to M/s Baramati Agro Ltd.”

To this, MLA Rohit Pawar has responded by posting on X “This statement detailing the company’s stand regarding the action taken by ED against my company. All media representatives are requested to highlight this aspect as well.”

As per further information from the press release by Baramati Agro company,

The Enforcement Directorate, an esteemed agency of the Government of India has in its Press Release dated 08.03.2024 made gross factual errors. It has wrongly and illegally and by political motivation provisionally attached assets of Kannad Sugar Unit owned by Baramati Agro Ltd.

It states that the investigation is in relation to illegal sale of sugar by MSCB, however, is neither the competent authority to declare the same, nor does it substantiate the said findings and ED has transgressed the authority bestowed upon it. More importantly, the press release states that ED’s case is based on a FIR registered by Economic Offences Wing, Mumbai Police, wherein it is alleged that the SSKS were fraudulently sold by the then officials and Directors of MSCB at ‘throw away prices’ to their relatives/private persons without following the due procedure. However, the respected Economic Of- fences Wing, an esteemed agency of the Maharashtra Government, had not only not named Baramati Agro Ltd., as an accused in the said FIR but also recently on 20 January 2024, filed a blanket C Summary report in the said FIR. The relevant excerpt is reproduced herein for the benefit of the citizenry:

“During investigation it is found that the process of sanctioning loans by MSC Bank and sale of sugar mills are carried out in tune with legal provisions and MSC Bank has not caused financial loss from the same or directors of the bank, officials of bank etc. have not benefitted from the same. It is also found that the events of violations of guidelines of NABARD, RBI or other regularities do not amount criminal acts.

It is submitted that investigation does not reveal acts of commission of cognizable offence by the directors of MSC Bank or officials of MSC Bank. Allegations are of civil nature.

(…) No criminal offence has been made out as alleged.”

The filing of the said Closure Report in the predicate offence (FIR mentioned in the Press release) by a fellow esteemed agency of the Maharashtra Government was brought to notice of the ED, amidst the consistent cooperation showcased by Baramati Agro Ltd., with ED’s investigation. However, despite the same, and without any reasons to satisfy the learned ED on the need to provisionally attach assets, the assets of Baramati Agro Ltd., have been wrongly and illegally attached. This seems to be politically motivated.

At the relevant point in time in 2012 of acquisition of assets of Kannad SSK by Baramati Agro Ltd., MSCB Bank was being run by board of administrators appointed on the recommendation of the Hon’ble Reserve Bank of India, and not by the then officials and directors of MSCB, thereby there arises no question of there being any relation of officials/directors with any stakeholder of M/s Baramati Agro Ltd as alleged in the press note. Therefore, the press note of the ED in its attempt to substantiate the illegal provisionally attachment order, relies upon factually incorrect allegations. This is reinforced by the findings of the EOW, Mumbai of there being no criminal offence being made out. We request the ED to refer to the findings of the esteemed agency – Economic Offences Wing, Mumbai, whose FIR is relied upon by the ED and refrain from publishing defamatory and factually incorrect findings.

We are steadfast in our fight for justice and the provisional attachment order will not adversely affect the large number of farmers, workers and other stakeholders who have contributed not only to Kannad Sugar Unit of Baramati Agro Ltd. but also to the area’s growth and development. We reserve our lawful rights to take legal action against this malafide step by the ED, whilst continuing to cooperate with the investigation as law abiding citizens of this country.

Shreyas Vange