Newforold notes scam: ED attaches 50 kg gold of TN businessman

The Enforcement Directorate (ED) on Tuesday said it has provisionally attached around 50 kg of gold ingots/bars worth over ₹13,96,88,246 crore of businessman J.Sekhar Reddy and his associates in connection with new-for-old currency notes scam.

The action has been taken under the provisions of Prevention of Money Laundering Act, 2002 (PMLA), the ED said.

In a statement , the ED said following demonetisation, the Income Tax Department searched various places belonging to Reddy, Managing Partner of SRS Mining, and seized about ₹97 crore in old currency notes, ₹34 crore in new currency notes and 177 kg of gold bars.

Following that, the Central Bureau of Investigation (CBI) registered an FIR against Reddy and his associates for converting demonetised currencies into new currency notes in a fraudulent manner, the ED said, adding it had also initiated investigations under PMLA against Reddy and others.

According to the ED statement, ₹10 crore in old currency, ₹34 crore in new currency, 6.5 kg of gold bullion, and 30 kg of gold seized in its raids has already been attached provisionally.

During the searches, 49.480 kg of gold bars valued at ₹13,96,88,246 were recovered and seized by the I-T officials from a flat belonging to SRS Mining.

Reddy has stated that cash seized by the Income Tax department belongs to his SRS mining Company and admitted that it was unaccounted money.

“However, he has not divulged the actual source of new currencies other than stating that it is from the sand mining business,” the ED said.