ED arrests promoter of Chennai-based firm in Rs 564 crore money laundering case

The Enforcement Directorate (ED) has arrested the promoter of a Chennai-based firm in a Rs 564 crore money laundering case.

The Enforcement Directorate has arrested the promoter of Chennai-based Coastal Energy Private Limited, Ahmed AR Buhari, under the Prevention of Money Laundering Act (PMLA), officials said.

The case involves the overvaluation of coal prices, in which public sector undertakings (PSUs) paid a higher price for the purchase of coal.

The ED had initiated the money laundering investigation after the Central Bureau of Investigation (CBI) filed an FIR under various sections of the Indian Penal Code (IPC) and the Prevention of Corruption Act against Ahmed AR Buhari and other unknown officials of PSUs.

The Directorate of Revenue Intelligence also conducted an investigation in this case, and a show cause notice was issued to the party in accordance with the provisions of the Customs Act.

READ | ED conducts raids at Indiabulls Finance Center in Mumbai

Ahmed Buhari allegedly controls Coastal Energy Private Limited (Chennai), Coastal Energen Private Limited, Coal & Oil Group (Dubai), and other offshore companies in Mauritius and the British Virgin Islands.

"The PSUs were supplied with coal of lower calorific value instead of the higher specification for which the tenders were floated and executed by the Coastal Energy Private Limited. The overvaluation of lower quality coal ultimately was done on the basis of a fraudulent Certificate of Sampling and Analysis [COSA], whereas the original COSA depicting the genuine quality of coal was suppressed," the agency said in a statement.