ED Files Chargesheet in Ahmedabad Against Hellios Tubealloys in Rs 28.54 Crore Bank Fraud Case
The Enforcement Directorate (ED), Ahmedabad Zonal Office, has taken a significant legal step by filing a chargesheet in the special PMLA court in Ahmedabad earlier this week. This action targets Hellios Tubealloys Pvt Ltd and its directors in a high-profile money-laundering case connected to a bank fraud amounting to Rs 28.54 crore with the Bank of Baroda.
Investigation Initiated Based on CBI FIR
The ED launched its investigation into this matter based on a First Information Report (FIR) registered by the Central Bureau of Investigation (CBI). The CBI had accused the company and others of criminal conspiracy and cheating under Sections 120B and 420 of the Indian Penal Code, as well as under the Prevention of Corruption Act. In December 2021, the CBI filed its own chargesheet, alleging that Hellios Tubealloys Pvt Ltd and its directors, Shantilal Sanghvi and Mahesh Sanghvi, were involved in cheating the bank.
ED's Prosecution Complaint and Allegations
The ED's prosecution complaint, filed under the Prevention of Money Laundering Act (PMLA), names not only the company and its directors but also several other entities. These include the sister company SLS Stainless Pvt Ltd, Eckhardt Engineering Pvt Ltd, Hitendra Sanghvi, Pradeep Sanghvi, Zenith Strips Ltd, Rajesh Karwasra, and Scorodite Stainless India Pvt Ltd.
According to the ED, during its PMLA investigation, the agency uncovered that Hellios Tubealloys Pvt Ltd and its directors allegedly defrauded the Bank of Baroda by diverting and siphoning bank funds totaling Rs 28.54 crore to sister concern companies. This was done without any genuine business transactions to justify the transfers. Additionally, the company is accused of issuing bogus Letters of Credit to banks to secure loan funds. The directors are alleged to have deliberately submitted falsified stock statements and books of accounts, with the dishonest intention of causing wrongful loss to the Bank of Baroda.
Provisional Attachment of Properties
In a related development in December 2024, the ED provisionally attached immovable properties valued at Rs 19.37 crore under the provisions of PMLA. These properties include commercial land located in Rajula, Saurashtra, and a residential flat in Ahmedabad, as part of efforts to recover the alleged illicit gains.
Background of the Company
The ED investigation revealed that Hellios Tubealloys Pvt Ltd was incorporated with the stated objective of trading in stainless steel products, such as stainless-steel sheets, coils, plates, and fittings, as well as manufacturing various types of stainless-steel pipes and tubes. The company had been granted a credit facility aggregating Rs 29.67 crore by the Bank of Baroda, which forms the basis of the alleged fraud and money-laundering activities.
