Mumbai: The proprietor of a city-based bullion firm was arrested by the Enforcement Directorate (ED) on Friday for allegedly using ₹84.5 crore in demonetised currency to buy 258 kg of gold after the Central government scrapped ₹1,000 and ₹500 notes in November last year.
Officers with the ED said between November and December 2016, ₹84.5 crore in demonetised currency was deposited in the account of two city-based firms, Pihu Gold and Satnam Jewels, in a span of 41 days. This was electronically transferred to the account of Pushpak Bullion, and used to buy the gold.
An ED officer said, “On investigating these transactions, we found that Pihu Gold and Satnam Jewels did not have the financial wherewithal to make such large cash deposits. We followed the money trail and found that these were dummy companies floated by Pushpak Bullion.”
The ED probe discovered that Pushpak Bullion was unable to deposit the cash in its own account as it had been declared as a Non-Performing Asset by a bank, and such a large deposit would have caused suspicion. To overcome this hitch, the two dummy companies were created by the accused.
“Chandrakant Patel, director, Pushpak Bullion, was found to be the mastermind of the money laundering racket, and was placed under arrest on Friday,” the officer said.
Mr. Patel has been charged under the Prevention of Money Laundering Act, and the source of the demonetised currency is being investigated.
“Post demonetisation, many bullion traders had accepted old currency, offering to convert it into gold for a commission. We are verifying if Mr. Patel did so,” he said.
