Bengaluru: The Enforcement Directorate has arrested Ozone Urbana Infra Developers chairman and managing director S. Vasudevan in a money laundering investigation involving an alleged ₹927.22 crore fraud against homebuyers.
Vasudevan, the company’s promoter, was arrested by the ED’s Bengaluru Zonal Office on September 30 under the Prevention of Money Laundering Act.
He was produced before a Special PMLA Court in Bengaluru on October 1, which granted the agency 14 days of custody for further questioning.
The ED alleges that Ozone Urbana collected hundreds of crores from homebuyers but failed to deliver apartments or refund the money. Investigators are now tracing how the funds were allegedly diverted through group companies and related individuals.
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Around 1,351 Homebuyers Allegedly Paid ₹927 Crore
Court records linked to the ED proceedings show that Ozone Urbana Infra Developers allegedly collected approximately ₹927.22 crore from around 1,351 homebuyers for its township project at Devanahalli near Bengaluru.
The buyers had booked apartments and other residential units expecting construction and possession within promised timelines.
The agency alleges that several buyers were instead left without possession even after substantial payments had been made.
According to the ED, the company also promoted a scheme under which it would pay pre-construction EMIs until buyers received possession of their flats.
Investigators allege that this commitment was subsequently not honoured.
The ED claims the company neither completed the units nor refunded money deposited by affected buyers.
These allegations form the foundation of the money laundering investigation.
ED Alleges Homebuyer Funds Were Diverted Elsewhere
The case goes beyond project delays.
According to the ED, money collected for construction was allegedly transferred to other group companies and associated individuals rather than being fully used for development of the promised residential project.
Court records cite alleged inter-corporate deposits of about ₹49.07 crore to several group concerns.
They also refer to transfers exceeding ₹180 crore to Tuscan Consultants and Developers Pvt. Ltd.
The agency further alleges that funds were routed into accounts linked to Vasudevan and members of his family.
The ED has described the alleged ₹927.22 crore collected from homebuyers as proceeds of crime for the purposes of its PMLA investigation.
That characterisation remains subject to judicial scrutiny.
₹423.37 Crore in Properties Already Attached
The arrest follows enforcement action taken during 2025.
On August 1 last year, the ED searched 10 premises connected with the investigation and seized documents it said were relevant to suspected diversion and misappropriation of project funds.
On October 4, 2025, the agency provisionally attached immovable properties valued at approximately ₹423.37 crore.
The ED said those assets were linked to the alleged proceeds of crime generated through the homebuyer transactions.
A provisional attachment does not by itself mean the properties have been permanently confiscated.
Such action under the PMLA is subject to further adjudication and legal proceedings.
CBI Cases Also Form Part of Wider Investigation
The money laundering investigation originates from multiple FIRs registered at police stations in Bengaluru.
The Central Bureau of Investigation has separately registered cases against entities linked to the Ozone group following directions from the Supreme Court.
Those cases concern allegations of cheating homebuyers and financial irregularities involving residential projects.
The ED says Vasudevan is associated with several Ozone entities that have come under investigation.
The existence of parallel CBI and ED proceedings means investigators are examining both the alleged underlying fraud and the subsequent movement of money.
The CBI examines the predicate criminal offences, while the ED investigates whether money allegedly generated from those offences was concealed, transferred or used through financial transactions.
Court Grants ED 14 Days to Trace Money Trail
During the remand proceedings, the ED sought custodial interrogation to reconstruct the movement of funds.
A Bengaluru Special Court granted the agency 14 days of custody.
Bar & Bench reported that Vasudevan will remain in ED custody until October 14.
Investigators are expected to question him about transfers between group companies, payments to related entities and the eventual use of money collected from homebuyers.
The ED is also examining whether properties or other assets were acquired using funds allegedly diverted from the project.
Bank statements, company ledgers, inter-corporate transactions and records seized during earlier searches are expected to form an important part of this exercise.
Ozone Urbana Is Also Under Insolvency Proceedings
The company is simultaneously undergoing insolvency proceedings.
Ozone Urbana Infra Developers entered the Corporate Insolvency Resolution Process following a National Company Law Tribunal order dated June 10, 2026.
A public announcement seeking creditor claims was subsequently issued on June 30.
The company’s insolvency portal shows that homebuyers and other creditors have been submitting claims as part of that separate process.
The insolvency proceedings and the ED investigation are legally distinct.
The insolvency process focuses on resolving the company’s financial distress and creditor claims, while the ED proceedings examine alleged money laundering and diversion of funds.
For affected homebuyers, however, both processes could influence efforts to recover money or obtain possession.
Investigation Now Focuses on Where the Money Went
The ED’s immediate task is to establish the complete financial trail.
Investigators are examining which entities received money from Ozone Urbana, how quickly it moved between accounts and whether it ultimately funded assets or transactions unrelated to the project.
The agency is also examining the role of other directors, group entities and individuals allegedly involved in handling the money.
Further arrests, attachments or summons could follow depending on what investigators find.
Vasudevan has not been convicted, and the allegations against him remain subject to investigation and trial.
What this means for you
Homebuyers facing prolonged delays should preserve allotment letters, builder-buyer agreements, loan records, payment receipts and communications with the developer. Where a project is also under insolvency proceedings, buyers should separately verify whether their creditor claims have been correctly filed with the resolution professional.
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