Chennai Court Orders Asset Restoration in High-profile Loan Fraud Case

A PMLA court in Chennai has ordered the restitution of Rs 235 crore in assets to Indian Bank, amid a money-laundering probe against Saravana Stores (Gold Palace) for loan fraud. The Enforcement Directorate has been investigating since May 2022, following a CBI FIR prompted by the bank's complaint.

A special court under the Prevention of Money Laundering Act (PMLA) in Chennai has issued an order to restore assets valued at approximately Rs 235 crore to Indian Bank. This development is part of an ongoing money-laundering investigation involving a city-based company accused of defrauding the lender.

The court's directive pertains to Saravana Stores (Gold Palace), with charges yet to be framed. The Enforcement Directorate (ED) initiated the investigation in May 2022, after a Central Bureau of Investigation (CBI) FIR prompted by a complaint from the bank.

The ED, having frozen assets worth Rs 234.75 crore, received confirmation from the PMLA's Adjudicating Authority. The return of assets is sanctioned under section 8(8) of the PMLA. The ED claims the firm and its partners, with the connivance of public officials, committed significant financial discrepancies to secure and misuse loan funds.