ED restores ₹52.35 cr assets in Shakti Bhog money laundering case linked to ₹3,269 cr bank fraud

The Enforcement Directorate (ED) has restored assets worth ₹52.35 crore to the liquidator of Shakti Bhog Foods Limited (SBFL) in connection with a money laundering investigation linked to a ₹3,269 crore bank fraud. The restored assets include both movable and immovable properties that were earlier attached by the agency during its probe into financial irregularities involving the company and its directors.

The ED's probe is based on a 2021 case registered by the Central Bureau of Investigation (CBI), in which SBFL directors were accused of falsifying accounts, forging documents, and siphoning off funds borrowed from a consortium of 10 banks led by the State Bank of India. The company, which was in the business of manufacturing wheat flour, rice, and pulses, had taken credit facilities that were allegedly diverted for purposes unrelated to business operations.

According to an official statement, the ED has so far attached assets worth ₹131 crore and filed six charge sheets in the case. Following a petition by the liquidator appointed by the National Company Law Tribunal (NCLT) on behalf of the Committee of Creditors (CoC), the agency consented to restore a portion of the attached properties. "In accordance with the intent of restoring the proceeds of crime (POC) to legitimate claimants and victims of the offence of money laundering, ED consented for restoration of the certain attached properties," the agency said.

The ED stated that SBFL routed funds through 108 dummy and shell entities, using fake bills and transport documents to create the appearance of genuine business transactions. These dummy entities were operated by entry operators, who charged commission to provide accommodation entries. Funds were siphoned off in the form of cash, commission payments, and trade discounts. Some of the diverted amounts were eventually re-routed back to SBFL, its directors, promoters, and unrelated third parties.

The agency added that the diverted loan funds were used to purchase properties and other assets. It also noted that these funds were projected as legitimate through a series of complex financial transactions. The ED has previously restituted properties worth over ₹25,000 crore to banks and victims in other money laundering cases.