In its FIR, CBI alleged that firms like Padmavati Enterprises, Unique Engineers, Balaji Enterprises and Ruthwik Associates swindled Rs 6,643 crore. “Nine firms are non-existent. They have been created to run fraudulent operations with the help of employees,” it alleged. A KPMG forensic audit revealed that the accused had borrowed Rs 9,394 crore from Canara Bank and 13 other banks.
The CBI’s banking fraud and securities cell in Bengaluru issued the FIR against Transstroy, Sambasiva Rao, company’s CMD Cherukuri Sridhar and director Akkineni Satish. A case was lodged under sections of the IPC and Prevention of Corruption Act. Rao, however, denied any fraud and said the CBI had wrongly filed the FIR. He said he had taken only Rs 700 crore loan.
For instance, Padmavati Enterprises had Sudhakar Babu Gorantla, an employee of Transstroy, as director. Later, the firm diverted Rs 1,848 crore. Similarly, Unique Engineers had an invoice associated with M Sambasiva Rao, a former director of Transstroy.
The CBI said Rs 7,153 crore was first transferred from Transstroy account to nine vendors — Padmavathi Enterprises, Balaji Enterprises, Ruthwik Associates, Unique Engineers, Subhakari Enterprises, Agastya Trade Links Private Ltd, Khanala Trading India, AS Associates and Vijay Engineering Equipment — and Rs 6,202 crore was brought back to Transstroy account. The amount was later diverted to related parties, special purpose vehicles and others. An amount of Rs 350 crore was transferred into the accounts of promoters. When the accounts of Sridhar and director R Leela Kumar were checked (between 2012 and 2014), it was found that Rs 450 crore was transferred from the accounts of specific vendors.
“The company has also indulged in tampering of its balance sheet,” the CBI alleged.
Transstroy’s book of accounts had shown that Rs 719 crore was written off as on April 1, 2016, stating that the unbilled revenue was treated as a sale.