ED freezed account of Udhaya Foundation; Attached Immovable Property worth Rs.36.3 Crore

The Directorate of Enforcement, initiated investigations on the basis of an FIR registered by Central Crime Branch-I, Chennai under various sections of the IPC wherein it was alleged that the complainant (Gaurav Chachra, Director of M/s Pettigo Commercio Internacional Lda, a subsidiary of the UK based Lyca Group having significant presence in India in form of Lyca Productions, Lyca Hotels etc.) had been defrauded of 114.37 Crore by the Kallal Group and its Directors/founders Saravanan Palaniappan, Vijaykumaran, Aravinth Raj and Vijay Ananth alongwith, Mrs. Lakshmi Muthuraman and Mrs. Preetha Vijayananth.

ED investigations found that the fraud is really worth Rs. 300 crore since the Lyca Group made further investments/loans to the accused group and its subsidiaries without any due diligence or reason. This resulted in searches at both the accused’s and complainant’s related entities on 27.04.2023 and 16.05.2023, which led to the discovery of various incriminating evidences in the form of digital evidences, documents, properties, suspicious cash and hawala transactions, all of which are still being investigated by the ED.

Meanwhile, on 25.05.2023, the ED provisionally attached various immovable properties across Tamil Nadu valued at Rs. 36.3 Crore and further attached Rs. 34.7 lakh available in the bank account of M/s Udayanidhi Stalin Foundation as it received the proceeds of crime amounting to Rs. 1 Crore. The trustees of the aforementioned charity failed to explain the reasoning behind the aforementioned receipt from the parties concerned in the case.

Thus total Proceeds of Crime in the said case is around 300 Crore of which Immovable properties valued at Rs.36.3 Crore and movable properties in form of bank account with available balance of Rs. 34.7 Lakhs have been attached.

According to the ED, the trustees of the Udhayanidhi Stalin Foundation ‘failed to explain the rationale’ for receiving Rs.1 crore from the Kallal Group, therefore its bank account was seized. According to the Income Tax Department’s website, gifts to the foundation are tax-deductible under Section 80G.