The Enforcement Directorate (ED) conducted search operations at six locations in Hyderabad in connection with a large-scale bank fraud linked to M/s SEW Infrastructure Ltd. (SIL), M/s Prasad and Company (Project Works) Pvt. Ltd. (PSPWPL), their group firms and promoters.
The money laundering probe stems from a case registered by the Central Bureau of Investigation (CBI) against M/s SEW LSY Highways Limited and others for siphoning of loan funds, cheating and criminal misconduct, leading to loss of public money.
M/s SEW LSY Highways Ltd was incorporated as a Special Purpose Vehicle (SPV) for the execution of a highway concession contract awarded by the Uttar Pradesh State Highway Authority to a consortium of M/s SIL and M/s PSPWPL.
The SPV was sanctioned a term loan of ₹1,700 crore by a consortium of 14 banks led by Punjab National Bank. The Engineering, Procurement and Construction (EPC) contracts for the project were awarded to M/s SIL and its group entities, which in turn sub-contracted the work to other firms.
The ED’s investigation has revealed a complex web of intra-group sub-contracting through entities such as SEW Transport Networks Ltd (STNL), with work being passed on at successively lower values. This practice enabled the promoters to divert and siphon off substantial portions of the loan funds. PSPWPL, which held a 30% stake in the SPV, also received diverted funds and subsequently infused them back as the promoters’ required equity contribution, instead of it coming from legitimate sources.
Even after ₹603.68 crore was disbursed by the banks to SEW LSY Highways Ltd, the project remained incomplete and the loan account eventually turned into a non-performing asset. The outstanding amount now stands at ₹621.78 crore.
During the search operations on July 22, the ED seized incriminating financial records and property documents, valued at approximately ₹120 crore, held in the names of the promoters and their family members. In addition, 33 bank accounts belonging to SEW Infrastructure Ltd, SEW Transport Networks Ltd, their directors and relatives have been frozen.
Further investigation is underway.
Published – July 23, 2025 09:27 pm IST
