NEW DELHI: The Supreme Court has mandated the Enforcement Directorate (ED) to initiate an investigation into accusations of money laundering leveled against the former promoters of the automotive component manufacturer, Amtek Auto Limited. The allegations suggest a massive financial misappropriation, where lenders were reportedly defrauded of a staggering Rs 20,000 crore.
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The bench comprising Justices BR Gavai and Sandeep Mehta, who have also called for a detailed status report from the ED within six months. During the proceedings, the judges indicated that initial findings suggest possible collusion with bank officials.
Senior Advocate Kavin Gulati serves as the amicus curiae, providing legal expertise, while Advocate Jai Anant Dehadrai represents the petitioner. Additional Solicitor General SV Raju is advocating on behalf of the ED.
A Public Interest Litigation (PIL) spearheaded by advocate Jaskaran Singh Chawla, who is pushing for a thorough investigation into the activities of Amtek Auto Limited’s promoters, directors, and associated entities. The Supreme Court’s involvement began on April 5, 2022, when it demanded a response from the Central Government regarding this matter.
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The case has already seen involvement from the Central Bureau of Investigation (CBI) and the Serious Fraud Investigation Office (SFIO), with the latter employing forensic auditors to dissect the financial intricacies of Amtek Auto Limited. Certain banks have acknowledged encountering fraudulent transactions in relation to the case.
Background
Amtek Auto’s financial company became public in 2017 when its insolvency plea was accepted by the National Company Law Tribunal, disclosing liabilities of around Rs 14,000 crore. The company had previously failed to repay bondholders in September 2015, leading to a default of nearly Rs 800 crore.
The resolution process saw a proposal from Liberty House in July 2018, which was later finalized with Deccan Value Investors in November 2021, settling the debts at a significant loss to the lenders.
This investigation into Amtek Auto Limited financial dealings marks a crucial step towards addressing corporate fraud and ensuring accountability within India’s auto component industry.
CASE TITLE: Jaskaran Singh Chawla vs Union Of India and ors
