New Delhi, Dec 3 (PTI) The manufacturer of Coldrif syrup, whose consumption is alleged to have killed at least 20 children in Madhya Pradesh, used industrial-grade raw materials instead of pharma-grade sans quality checks to prepare the medicine, an ED probe has found.

The federal probe agency further claimed that officials of the Tamil Nadu Drugs Control Department were in "frequent touch" with proprietor G Ranganathan of the accused company-- Chennai-based Sresan Pharmaceuticals-- but the mandated annual inspections of the firm were "not" conducted.

The Enforcement Directorate said this in a statement issued on Wednesday as it attached two flats in Chennai belonging to Ranganathan and his family members.

The assets are located at Kodambakkam in Tamil Nadu's capital city and are worth Rs 2.04 crore, the statement said.

Ranganathan was arrested by the Madhya Pradesh Police in October.

The agency alleged Sresan Pharma indulged in "rampant unfair trade practices to suppress its manufacturing costs and increase profits which are nothing but proceeds of crime under the Prevention of Money Laundering Act".

Probe found, it said, that the manufacturer used industry-grade raw materials in the manufacturing of medicines instead of pharma-grade raw materials "without" proper quality checks.

"Such materials were being purchased in cash without invoices to avoid creation of records," the ED said.

Though the officials of the Tamil Nadu Drugs Control Department were in frequent touch with the proprietor of Sresan Pharma, the annual inspections mandated as per the Drug and Cosmetic Rules were "not" conducted, it added.

The ED booked a money laundering case against the accused taking cognisance of two FIRs, one filed by the Madhya Pradesh Police and other by the Tamil Nadu Police.

The Madhya Pradesh Police complaint alleged that Coldrif contained toxic glycol compounds and caused multiple incidents of acute renal failure in children leading to the death of at least 20 children in the state.

Laboratory findings confirmed the presence of "high" concentrations of Diethylene Glycol (DEG) and Ethylene Glycol (EG), far beyond the safe limit, according to the police FIR.

"The negligent and adulterated manufacturing practices adopted by Sresan Pharma led to the poisoning of the cough syrup," the ED said quoting the police FIR.

The second complaint which the ED took cognisance of was filed by the Tamil Nadu Directorate of Vigilance and Anti-Corruption (DVAC) against P U Karthikeyan, director in-charge of the Tamil Nadu Food Safety and Drug Administration Department in an alleged bribery case. Karthikeyan was arrested by the DVAC in July.

Tamil Nadu ordered the closure of the accused pharma company after the deaths and also suspended two drug inspectors.

Madhya Pradesh also suspended two drug inspectors apart from a Food and Drug Administration deputy director. PTI NES KVK KVK

Cough syrup deaths: manufacturer allegedly used industrial grade inputs; ED attaches assets and files money laundering case. The ED alleges the manufacturer used industrial grade raw materials without proper quality checks, purchased inputs in cash without invoices, and produced cough syrup containing high concentrations of Diethylene Glycol and Ethylene Glycol linked to child deaths; treating suppressed manufacturing profits as proceeds of crime under the Prevention of Money Laundering Act, the agency attached assets and opened a money laundering case after taking cognisance of two FIRs.