ED conducts searches at TRS MP Nageswara Rao's offices

HYDERABAD: Enforcement Directorate officials on Friday conducted searches at some of the offices of Madhucon Group belonging to TRS MP and its Lok Sabha floor leader Nama Nageswara Rao, sources said.

The searches are related to alleged fund diversion of Ranchi Expressway Limited, a Madhucon Group company, they said.

The searches were conducted at Madhucon offices in Jubilee Hills here and residences of some of the directors, sources said.

The Central Bureau of Investigation (CBI), in March 2020, booked the promoters of the Ranchi Expressway Ltd, including its CMD K Srinivasa Rao, for allegedly causing a loss of over Rs 1,000 crore to a consortium of banks led by Canara Bank.

Ranchi Expressway Limited had been incorporated in the year 2011 as a special purpose vehicle promoted by Madhucon Infra Limitedand Madhucon Projects Limited to carry out the four-laning of Ranchi-Jamshedpur Highway section of NH-33 from km 114.000 to km 277.500 in Jharkhand on Design, Build, Finance, Operate, Transfer (DBFOT) Annuity basis.

The directors allegedly indulged in fraudulent acts to get a total loan amount of Rs 1,029.39 crore released by the consortium of banks but no progress was made on the project with the loan becoming a non-performing asset in 2018, CBI had said.

On January 31, 2019, the National Highways Authority of India terminated its contract with the company and forfeited Rs 73.95 crore by way of encashment of the performance bank guarantee with Canara Bank.