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ED Investigates Paliyekkara Toll in NHAI Fund Embezzlement

The Directorate of Enforcement (ED) conducted raids on the office premises of four companies in connection with the alleged misappropriation of NHAI funds totaling Rs 102.4 crore. According to the central financial investigation agency, the targeted offices included those of Bharat Road Network Limited (BRNL) and Guruvayoor Infrastructure Private Limited (GIPL) in Kolkata, KMC Constructions Ltd in Hyderabad, and GIPL’s office in Thrissur.

Guruvayoor Infrastructure is responsible for the Paliyekkara toll plaza in Thrissur as a BOT (build-operate-transfer) company. The ED initiated these raids based on the FIR (first information report) filed by the CBI, which raised concerns about undue gains obtained by these firms during the construction of the national highway between Mannuthy and Angamaly.

During the searches, the ED discovered that GIPL had invested toll collections into mutual funds without remitting the cost of uncompleted work to NHAI. As a result, a freezing order was issued for a value of Rs 125.21 crore against the bank balance and fixed deposits of Guruvayoor Infrastructure in Kolkata.

In addition, incriminating documents were found in the office of KMC Constructions, which revealed that it had sold its 51% stake in GIPL to BRNL without a proper valuation and without obtaining necessary approval from NHAI. Consequently, a freezing order was issued against the bank balances of KMC Constructions Limited for a value of Rs 1.37 crore.

ED has registered a case of money laundering based on the FIR filed by the CBI against GIPL and others, alleging a criminal conspiracy between the company and its then director Vikram Reddy with NHAI officials in Palakkad. This alleged conspiracy pertains to the execution of work related to two sections of National Highway 47 from 2006 to 2016, resulting in NHAI being cheated of approximately Rs 102.44 crore.

The ED’s investigation found that GIPL, along with sub-contractor KMC Constructions Ltd, NHAI officials, and the project independent engineer, fraudulently obtained a completion certificate for the road project and began collecting toll from the public. Furthermore, it was revealed that the accused company generated revenue by letting out advertisement space without completing the construction of bus bays, leading to an undue benefit of Rs 125.21 crore. This amount is considered the value of unexecuted work and is categorized as proceeds of crime under PMLA, 2002.

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