ED officials said that in the larger interest of depositors, ED took a pragmatic view and decided to withdraw the SLP (Special Leave Petition) before the apex Court. File
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The Enforcement Directorate (ED), Mumbai Zone, has restituted immovable properties worth ₹289.54 crore to the Competent Authority under the Maharashtra Protection of Interest of Depositors (MPID) Act appointed by Government of Maharashtra in the case of M/s Pen Co-operative Urban Bank Limited.
At least two lakh depositors and 42,000 shareholders of Pen Co-operative Urban Bank have lost their money in a money-laundering case.
In a press statement released on Friday evening (January 17, 2025), the ED officials said the assets were provisionally attached by the ED under Section 5 of the Prevention of Money Laundering Act (PMLA), 2002, as the erstwhile office-bearers had cheated the banks and siphoned off the bank funds for private investments.
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“The investigation was initiated based on the First Information Report (FIR) registered by Pen Police Station from Raigad district of Maharashtra. The charge sheet filed by the Law Enforcement Agency (LEA) said the office-bearers of the bank entered into criminal conspiracy with then auditors of the bank willfully and intentionally manipulated the books of accounts of Pen Bank and fraudulently reported profit and caused a loss of ₹651.35 crore to the bank,” the ED statement said.
Investigations revealed that the proceeds generated out of crime of forgery and cheating was diverted and routed through the bogus cash credit accounts opened in the said bank using the services of cheque discounters in the market. Part of such Proceed of Crime (POC) was utilised for the purchase of immovable properties at various locations in Raigad in the names of third parties as benami properties. These properties measuring 70.9 acres and valued at ₹25.20 crore were attached under Section 5 of PMLA on May 26, 2014 and December 03, 2014.
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One of the depositors from the Pen Co-operative Urban Bank Limited filed a criminal writ petition before the Bombay High Court seeking the release of the attached properties in the case. On October 7, 2016, the High Court directed the ED to hand over the properties to the MPID. Challenging the High Court’s order, the ED moved the Supreme Court and on November 3, 2017, the apex court stayed the Bombay High Court’s order.
On February 1, 2019, the MPID authorities filed an application under Section 8(8) of the PMLA before a Special PMLA Court in Mumbai to confiscate the attached property to MPID for its restitution.
In the press statement, the ED officials said that in the larger interest of depositors and currently ongoing restitution efforts, ED took a pragmatic view and decided to withdraw the SLP (Special Leave Petition) before the apex Court and said that on December 13, 2024, an affidavit was filed before the Supreme Court and SLP was withdrawn.
The investigating agency thereafter filed an affidavit before a Special Court (PMLA), Mumbai, expressing willingness to restitute the properties covered by the High Court. On January 14, 2025, the Special Court (PMLA) allowed the ED’s application and ordered the restoration of 29 immovable properties which are presently valued at ₹289.54 crore to the Competent Authority under MPID Act.
Published – January 18, 2025 04:20 pm IST
