The Enforcement Directorate (ED) has arrested Ahmed A. R. Buhari, Promoter of Coastal Energy Private Limited, Chennai, under the Prevention of Money Laundering Act (PMLA), 2002, in a case of over valuation of coal prices whereby the Public Sector Undertakings paid higher price for the purchase of coal.
According to a press release, the ED initiated investigation of money laundering on the basis of a FIR registered by the Central Bureau of Investigation (CBI), New Delhi, against Ahmed Buhari and other unknown officials of PSUs under various sections of Indian Penal Code, 1860 and Section 13(2) read with Section 13(1) (d) of Prevention of Corruption Act, 1988. The investigation in the matter was also conducted by the Directorate of Revenue Intelligence and a show cause notice has been issued under the provisions of Customs Act, 1962.
Investigation by ED revealed that Ahmed Buhari was controlling the companies Coastal Energy Private Limited, Chennai, Coastal Energen Private Limited, Coal & Oil Group, Dubai, and other offshore entities located in Mauritius and British Virgin Islands. The PSUs were supplied coal of lower calorific value instead of the higher specification for which the tenders were floated and executed by the CEPL or MMTC and the coal was supplied by CEPL, either directly or through MMTC. The over valuation of lower quality of coal ultimately was done on the basis of fraudulent Certificate of Sampling and Analysis (COSA), whereas the original COSA depicting the genuine quality of coal was suppressed.
Investigation further revealed that Buhari generated proceeds of crime (POC) to the tune of ₹564.48 crore from the over valuation of coal. Buhari diverted the POC to the tune of ₹557.25 crore through CEPL and CNO Group entities, UAE and routed the same back to India through Precious Energy Holdings Ltd, BVI and Mutiara Energy Holdings Ltd, Mauritius to invest in Coastal Energen, India. The POC to the extent of ₹557.25 crore in the possession of Coastal Energen was already provisionally attached by the ED in 2020. Further investigation is in progress, the release added.
