The Directorate of Enforcement (ED), Mumbai attached assets valued at ₹50.20 crore belonging to M/s Kannad Sahakari Sakhar Karkhana Limited (Kannad SSK), owned by M/s Baramati Agro Ltd.
Nationalist Congress Party (Sharadchandra Pawar) MLA Rohit Pawar, the grandnephew of the patriarch, is the CEO of Baramato Agro Ltd.
This move is in accordance with the provisions of the Prevention of Money Laundering Act (PMLA), 2002, and is related to a case involving the illegal sale of sugar mills by the Maharashtra State Co-operative Bank (MSCB), ED officials said on Friday. The attached assets include 161.30 acres of land, plant, and machinery, and a building of the sugar unit located at Kannad in Chhatrapati Sambhajinagar district (previously Aurangabad).
The agency initiated the investigations based on an FIR registered by the Economic Offence Wing of the Mumbai Police under various Sections of the Indian Penal Code and the Prevention of Corruption Act. The FIR was filed following the Bombay High Court’s Order dated August 22, 2019.
The allegations in the FIR suggest fraudulent sales of SSKs (sugar mills) by MSCB officials and directors to relatives or private individuals without proper procedures
The agency’s investigation revealed that MSCB took possession of Kannad SSK Limited’s assets on July 13, 2009, under the SARFAESI Act to recover an outstanding loan of Rs. 80.56 Crore. However, the subsequent auction of Kannad SSK in 2012 was marred by irregularities, including disqualification of the highest bidder and questionable ties between other bidders, officials said.
“Apart from M/s Baramati Agro Ltd., two 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 sugar unit,” they said.
“Through our investigation, we established that the acquisition of Kannad SSK by M/s Baramati Agro Ltd was illegal, and the assets obtained through this process are considered proceeds of crime under the PMLA. A Provisional Attachment Order under PMLA was issued, attaching assets amounting to ₹50.20 Crore,” the agency officials said.
In January, Mr. Rohit Pawar, a first-time legislator from Karjat-Jamkhed, was summoned and questioned by the Central agency.
Earlier, three provisional attachment orders have been issued in the case, attaching assets worth ₹121.47 Crore. Additionally, one main prosecution complaint and two supplementary prosecution complaints have been filed in the Special PMLA Court, Mumbai, addressing the wrongful acquisition of three other SSKs.
“The court has already taken cognizance of all prosecution complaints in this ongoing case, and further investigations are underway,” the officials added.
Previously, the Pawars and the NCP (SP) had dismissed the case as politically motivated. It gained political importance, emerging as a focal point during the 2019 Maharashtra Assembly election when the party patriarch, Mr. Sharad Pawar, volunteered to appear before the ED for interrogation.
In 2020, when challenging the Mumbai police’s exoneration in the case, the ED informed the court that Baramati Agro not only supported another company’s bid to acquire a struggling cooperative sugar factory by funding the earnest deposits, but also financed the purchases through case credit from different banks intended for working capital, thereby engaging in the alleged diversion of funds.
