ED attaches Rs 263 cr assets of Deccan Chronicle group

According to The Economic Times, these properties attached by ED are other than the properties pledged by DCHL and its promoters to various lenders that are either under attachment or acquired and auctioned under SARFAESI Act/DRT proceedings.

The attachment comes a week after key lender turned shareholder Srei Infrastructure Finance, which currently holds around 24% stake, obtained approval of shareholders to appoint five directors on the DCHL board towards reviving the media house.

According to PTI, the agency said it has issued a provisional order for attaching “movable and immovable assets in the form of land, residential properties, shares, bank balance, foreign currency receivables and luxurious cars in a bank loan fraud case pertaining to Deccan Chronicle Holdings Limited (DCHL), Hyderabad for causing a total loss of Rs 1,161.93 crore to six public sector banks.

The Enforcement Directorate had booked a case under the Prevention of Money Laundering Act (PMLA) against the company and others based on a CBI FIR and chargesheet.

The agency said its investigation “revealed that DCHL had availed loans for working capital, purchase of capital goods and short-term loans by overstating the receivables, understating huge loan liabilities by furnishing fabricated financial statements and not disclosing the loans taken from other banks and non-banking financial companies.

“In total, DCHL availed 111 loans amounting to Rs 10,000 crore from 16 different banks between 2004 and 2012. Out of such loans, an amount of Rs 2,800 crore is outstanding to various banks as on September 30, 2012 excluding interest," it said.

Deccan Chronicle Holdings Limited (DCHL) publishes the largest circulated English newspaper in South India — Deccan Chronicle, bringing you every day the most comprehensive bouquet of news and analysis. Its fearless and unbiased journalism over 75 years has won the Deccan Chronicle a mature and dedicated readership from all over the world. And, it is growing.

Founded in 1938, the group’s flagship daily The Deccan Chronicle has a circulation of over 1.45 million copies and are published from eight locations in Andhra Pradesh and Telangana. DCHL also publishes The Asian Age, an English daily with editions in Mumbai, Delhi, Kolkata, and London. The group's financial daily the Financial Chronicle is published from Delhi, Mumbai, Hyderabad, Bangalore and Chennai. The company also published the Telugu paper Andhra Bhoomi. It also operates Odyssey, a leisure store.

The agency alleged, "Such loan amounts were used for other than the specified purposes, such as investing in 20 group companies or firms, acquiring companies with huge premiums, payments to Airbus towards purchase of cargo aircrafts, payments to BCCI for Indian Premier League franchisee of Deccan Chargers, payments towards dividends declared by Ms DCHL, buy-back of shares, issue of bonus shares, purchase of luxurious cars in the name of associates/group companies, repayment of earlier loans taken, among others."

The group companies of DCHL, it said, acquired movable and immovable properties with the loan received from Ms DCHL and did not disclose the same in the audited balance sheet of the companies concerned with a view to obscuring the identity of such properties which amounted to money laundering.

“Investigation also revealed that the loan funds used for purchase of retail franchisee by name 'Odyssey’ were received back by the promoters at a later date.

“To show a rosy picture in the eyes of investors/banks, DCHL had declared dividends, issued bonus shares, bought back shares by investing an amount of around Rs 230 crore and the promoters of DCHL also received Rs 143 crore as dividends by using loan proceeds which later became non-performing assets to banks," it said. (Courtesy news agencies)