HYDERABAD: The Central Bureau of Investigation (CBI) has said that Hyderabad-based Transstroy India Private Limited, which is embroiled in one of the biggest banking frauds in the country worth Rs 7,296 crore, had created fictitious companies in the name of maids, sweepers and drivers and made them directors to divert funds. Transstroy is owned by former TDP MP Rayapati Sambasiva Rao.
In its FIR, CBI alleged that Padmavati Enterprises, Unique Engineers, Balaji Enterprises and Ruthwik Associates swindled Rs 6,643 crore. “Nine are non-existing companies, which have been created to run fraudulent operations with the assistance of employees,” the CBI 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 booked under IPC sections for criminal conspiracy, cheating, forgery and falsification of documents and Prevention of Corruption Act.
Sambasiva 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 — Padmavati 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 again 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.
KPMG audit report revealed that only eight excavators were purchased from Volvo and purchase of 16 excavators from Unique Engineers was fabricated. It was also found that five tipper purchases were made from Tata Motors and purchase of another five tippers was fabricated with the same engine number and chassis numbers and operated without registration.
The company in its October 10, 2018, statement said that Rs 1,753 crore worth stock was lying at various project sites, including Rs 1,527 crore at Polavaram Irrigation Project. “It is not clear as to how a huge stock like this could be stored at the project site. The company has also indulged in tampering of its balance sheet,” the CBI alleged.
The difference in closing and opening of balance sheet was Rs 608 crore for Padmavati Enterprises, Balaji Enterprises and Ruthwik Enterprises. A cash payment of more than Rs 20 crore was made to meet labour payments at the site for Polavaram project, but they were not disclosed, it said.
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.