HYDERABAD: The Enforcement Directorate (ED) on Friday search the residence and offices of the Telangana Rashtra Samithi (TRS) MP Nama Nageswara Rao and Ranchi Express Way Limited directors in connection with Rs 1,064 crore bank fraud.
Search began at 7am in six locations at Madhucon Infra office in Jubilee Hills, the residence of Khammam MP Nageswara Rao, residences of CMD of Ranchi Express Way K Srinivasa Rao, other directors N Seetaiah and N Prithvi Teja. Nama Nageswara Rao is the personal guaranteer for the loan and Prithvi Teja is the son of Rao.
The Central Bureau of Investigation (CBI) had first registered the First Information Report (FIR) in 2019 and filed chargesheet in 2020 against Ranchi Express Way Limited and its directors.
The FIR also then named Madhucon Project, Madhucon Infra, Madhucon Tolly Highway, auditors and officials of a consortium of banks.
The ED is probing the case for money laundering under the Prevention of Money Laundering Act.
Banks led by Canara Bank agreed to fund Rs 1,151 crore with a contribution of Rs 503 crore by promoters.
The Serious Fraud Investigation Office(SFIO) in its preliminary report alleged that promoters round-tripped Rs 50 crore, claimed Rs 98 crore as maintenance, used Rs 94 crore of mobilisation advance, diverted Rs 22 crore, a total of Rs 264 crore was misappropriated.
The CBI alleged that there was no progress in the project work and the accused indulged in fraud to get a total loan of Rs 1,029 crore
The loan became a non-performing asset in 2018.
In January 2019, the National Highways Authority of India (NHAI) terminated its agreement with the company and forfeited Rs 73 crore.
The road contract is about four-laning of 163 kilometre stretch on NH-33 connecting Ranchi to Jamshedpur.
The project awarded by the NHAI to Madhucon Project Ltd in March 2011.
Madhucon floated a Special Purpose Vehicle Ranchi Express Way Limited for the execution of the project.
