The Enforcement Directorate has announced provisional attachment of movable and immovable properties worth Rs.51 crore for violation of provisions of Prevention of Money Laundering Act (PMLA) in the disproportionate assets case against Kadapa MP Y.S. Jaganmohan Reddy which is being investigated by the CBI.

The properties were acquired out of proceeds of crime by companies that benefited from concessions by the State government for investments in the businesses of Jagan. These companies were named in the first two out of four charge-sheets filed so far by CBI in Jagan’s case.

The properties attached by ED included 35 acres of land and fixed deposit of Rs.3 crore belonging to Hetero Drugs, 96 acres of land and fixed deposit of Rs.3 crore belonging to Aurobindo Pharma, over 13 acres of land of Janani Infrastructure and fixed deposit of Rs.14.5 crore of Jagati Publications. The latter two companies are owned by Jagan himself.

The government had allotted 75 acres of land each to Hetero Drugs and Aurobindo Pharma at the Special Economic Zone at Jadcherla in Mahabubnagar as a quid pro quo for investments in Jagan’s companies. Another 30.33 acres of land was transferred to Trident Life Sciences which falsely claimed to be a wholly owned subsidiary of Aurobindo Pharma at the Export Promotion Industrial Park of AP Industrial Infrastructure Corporation at Pashamylaram in Medak district by reducing the processing fee from 10 to 2 per cent.

The ED said the allotment of lands to Hetero and Aurobindo was done illegally by the government at rates lower than the ones finalised by its price fixation committee. The committee fixed Rs.15 lakh an acre for the first 25 acres and Rs.20.23 lakh an acre for the remaining 50 acres, but they were allotted at a bare Rs.7 lakh an acre. While Hetero and Aurobindo gained Rs.8.60 crore each, Trident Life Sciences benefited Rs.4.30 crore from fee reduction.

In return, the companies paid Rs.14.5 crore in Jagati Publications and Rs.15 crore in Janani Infrastructure. The payments were in the form of equity contribution which was in fact kickbacks for the favours done by the government.

Sources of income

In the wake of the provisional attachment orders issued by the ED, the agency will file complaints against these companies before the adjudicating authority under PMLA. The authority will then issue notices to the representatives of the companies to explain the sources of income. If they cannot explain the legitimate sources of income, the order of the ED would be confirmed. The whole process has to be completed in 150 days from the date of issue of the order.