MUMBAI: The Enforcement Directorate (ED) has seized and frozen cash, jewellery and bank funds worth ₹12

Published on: Aug 28, 2026, 08:13:00 IST

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MUMBAI: The Enforcement Directorate (ED) has seized and frozen cash, jewellery and bank funds worth ₹12.9 crore during searches in Mumbai and Vadodara in a money laundering probe into an alleged ₹160.55-crore bank loan default involving Bilpower Limited, officials said on Thursday.

The agency carried out searches at seven residential and business premises in Mumbai and Vadodara and three bank lockers in Mumbai on Tuesday as part of its investigation against the private firm, its directors and associate companies.

The searches resulted in the seizure of ₹43.90 lakh in cash and jewellery valued at ₹12.20 crore. Two bank accounts containing around ₹27 lakh were also frozen under the Prevention of Money Laundering Act (PMLA), while three bank lockers were frozen.

The money laundering case stems from an FIR registered by the Central Bureau of Investigation (CBI) and its subsequent chargesheet filed on September 3, 2024, against Bilpower Limited, its directors and associate companies. The company was engaged in manufacturing transformer laminations and cores and is accused of defaulting on loans taken from the State Bank of India (SBI).

According to the allegations, Bilpower Limited had availed itself of various loan facilities from SBI and allegedly diverted the loan proceeds, manipulated its books of account and caused a loss of ₹160.55 crore to the public-sector bank. The company’s loan account was classified as a non-performing asset (NPA) on April 18, 2012, with the principal outstanding at the time standing at ₹160.55 crore.

The firm was managed by RK Chaudhary and two others had several banking arrangements with SBI, including cash credit, working capital term loan, funded interest term loan and corporate loan facilities. It also availed itself of non-fund-based facilities such as bank guarantees, letters of credit (LCs) and foreign-currency exposure.

An LC is a bank-issued financial guarantee under which a seller is assured payment by the issuing bank if the agreed shipping and documentation conditions are met. An LC devolves when the buyer fails to make the payment and the issuing bank is required to honour the bill from its own funds.

The ED’s investigation has also revealed alleged transactions between the firm and certain shell entities in connection with the suspected diversion and round-tripping of bank funds, officials said.

According to the agency, LCs were allegedly further devolved in favour of these entities, with forged documents submitted and used as genuine. The diverted funds were subsequently allegedly routed through other entities controlled by members of the firm’s controllers or their associates, the ED said.

During Tuesday’s searches, the agency also identified and recovered documents purportedly relating to assets, including immovable properties, land and machinery. Other allegedly incriminating documents, books of account, ledgers and digital devices were also seized.

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