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The Enforcement Directorate (ED), Gurugram Zonal Office, filed a Prosecution Complaint (PC) on 15 December 2025 before the Hon’ble Special Court (PMLA), Gurugram, against the former directors and shareholders of M/s Allied Strips Limited (ASL), namely Gaurav Aggarwal, Mohender Aggarwal, Kolkata-based entry operator Jagdish Purohit, and other associated and unrelated entities. The action forms part of an ongoing investigation into a bank fraud and money laundering case involving ASL and related parties.
ASL, a leading steel manufacturing company, was admitted into the Corporate Insolvency Resolution Process (CIRP) in 2018, and GP Global Energy Private Limited was appointed as the resolution professional following the NCLAT order dated 6 May 2022.
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CBI FIR and Fraud Allegations
The ED’s investigation was initiated on the basis of an FIR lodged by the Central Bureau of Investigation (CBI), New Delhi, following a complaint dated 5 March 2022 filed by Canara Bank. The complaint alleged that ASL, through its directors, promoters, employees, and other collaborators, engaged in fraudulent diversion of bank funds, criminal misappropriation, criminal breach of trust, cheating, and other fraudulent acts, causing a wrongful loss of approximately Rs. 1,392.86 crore to the consortium of banks led by Canara Bank.
The investigation revealed that ASL transferred/diverted funds from its bank accounts to various entities and vendors in the form of advances and other payments, which were deliberately structured to evade recovery. These advances were never intended to be recovered and constituted the primary modus operandi for siphoning funds. Cash received in lieu of these advances was routed back to ASL’s accounts with the assistance of the entry operator.
Mechanism of Fund Diversion and Unrecovered Advances
During search operations at multiple premises linked to ASL promoters and directors, the ED uncovered that loan proceeds from the consortium were diverted to unrelated firms in the form of advances. Key recipients included:
- M/s Eurekus Infrastructure Private Limited
- M/s Suncity Projects Private Limited
- M/s Jubilant Malls Private Limited
- M/s Kratos Projects Private Limited
- M/s HINS Projects Private Limited
- M/s HNS Infratech Private Limited
These advances were never recovered and ASL made no efforts to retrieve the amounts. Cumulatively, approximately Rs. 48.68 crore was advanced to these entities, forming part of the proceeds of crime (PoC).
Prior Attachments and Seizures
Earlier in the investigation, the ED had provisionally attached immovable properties worth around Rs. 44.09 crore belonging to M/s Suncity Projects Pvt. Ltd., M/s Eurekus Infrastructure Pvt. Ltd., and other associated entities. Including the latest actions, the total attachments and seizures in the case now stand at Rs. 45.51 crore.
Legal and Regulatory Implications
ED officials stated that the case underscores the necessity of strict enforcement against corporate fraud and misuse of banking funds. It highlights that diversion of bank loans and financial assistance is not only a direct financial loss but also a serious money laundering and legal violation issue.
Experts note that such cases demonstrate the systemic risks posed by corporate-level fraud, advance payments, and unrecovered funds, potentially undermining the stability of the financial system and investor confidence.
Ongoing Investigation and Next Steps
The ED emphasized that the investigation is ongoing. In the coming weeks, the agency may undertake further property attachments, detailed scrutiny of financial records, and potential arrests of involved parties. ED is committed to ensuring that all crime proceeds and diverted funds are brought within the ambit of the PMLA.
Officials further stated that the agency is working in close coordination with the banks and financial institutions involved to map the entire diversion network, track assets, and secure recovery of unlawfully obtained benefits.
This case sends a strong signal that corporate fraud, misuse of financial advances, and intentional non-recovery of funds are being addressed decisively by regulatory and enforcement agencies. ED has made it clear that stringent action will be taken against all entities and individuals found complicit in diverting consortium loans or engaging in money laundering practices.
