Mumbai, Jul 18 (PTI) A court here on Friday took cognisance of the Enforcement Directorate's chargesheet against MLA Rohit Pawar in the alleged Maharashtra State Co-operative Bank (MSCB) scam, noting that he prima facie found to have "knowingly participated in this fraudulent acquisition".

Special judge Satyanarayan Navander, hearing cases related to MPs and MLAs, issued summons to Pawar, his close associate and businessman Rajendra Ingwale and Pawar's firm Baramati Agro Limited. They have been asked to appear before the court on August 21.

The ED last month filed a fresh chargesheet in the case against Pawar.

"Accused Rohit Pawar - director of Baramati Agro- and Ingwale - director of Hi-Tech Engineering Corporation - are prima facie found to have knowingly participated in this fraudulent acquisition," the court said.

It was the third chargesheet and there are 17 accused, including firms, in the case.

The legislator of the Sharad Pawar-led NCP (SP) has been questioned by the ED twice in the past in connection with the case.

The MSCB money laundering case stems from an August 2019 FIR of the Mumbai police's Economic Offences Wing (EOW).

The scam pertains to an allegation that Sahakari Sakhar Karkhana (SSKs) were fraudulently sold by the then officers and directors of the MSCB at throwaway prices to their relatives/private persons without following the due procedure.

The agency has alleged that the MSCB, in order to recover an outstanding loan of Rs 80.56 crore of Kannad SSK Limited in Chhatrapati Sambhajinagar, took possession of all its assets in July 2009 under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest Act (SARFAESI) Act.

The MSCB conducted an auction on August 30, 2012 of Kannad SSK by fixing a "very low" reserve price based on a questionable valuation report, the ED alleged.

"Apart from Baramati Agro Ltd, two other parties entered into the bidding process. The bidder with the highest bid was technically disqualified on flimsy ground, whereas the other bidder was already a close business associate of Baramati Agro Ltd with no financial capacity or experience of running a sugar unit," it has said.

The Kannad SSK is owned by Baramati Agro Ltd, a company of Rohit Pawar.

The court, after perusal of record and documents, held that prima facie it emerges that the auction process of Kannad SSK "was marred by fraudulent practices".

Notably, the factory was revalued by Yes Bank at Rs 75 crore in March 2013, shortly after the auction, pointing towards undervaluation during the auction, the court noted.

There appears to be a pre-arranged scheme between Baramati Agro Ltd and Hi-Tech Engineering Corporation Pvt Ltd to acquire the factory at a suppressed price, it said.

It stated that from the facts disclosed, there is sufficient material to infer that both Pawar and Ingwale, along with Baramati Agro, "were knowingly involved in acquisition, possession, and use of proceeds of crime" by means of fraudulent auction.

"Thereby attracting the offence defined under relevant Prevention of Money Laundering Act (PMLA) provisions, which relates to direct or indirect attempts to indulge in or knowingly assist or be a party to the process or activity connected with the proceeds of crime," the court said.

It then took cognisance of the chargesheet and issued summons to the accused. PTI AVI NP

Money laundering under PMLA alleged in a fraudulent auction; summons issued and investigation continues. Court takes cognisance of a chargesheet alleging that the Kannad SSK auction was marred by fraudulent practices, including undervaluation, suspect reserve pricing and a pre-arranged bidding scheme that led to acquisition by a related company. Prima facie material indicates the accused knowingly participated in acquisition, possession and use of proceeds of crime, attracting offences under the Prevention of Money Laundering Act; the court issues summons on that basis.