ED probing 'settlement' allegations against Chennai Police in battle between company founders

New Delhi, Jan 22 (PTI) The Enforcement Directorate on Monday said it was investigating an allegation against the Chennai Police central crime branch (CCB) that the co-founder of a city-based company extracted a "settlement" of Rs 50 crore from his business partner through it though the actual claim amount was Rs 13 crore.
    The matter pertains to a money laundering case against a civil construction and infrastructure company called Ocean Lifespace India Pvt. Ltd., its promoter S K Peter or Sylvanus King Peter and some others.
    The federal agency had raided seven premises related to Peter in Chennai on January 19.
    The ED case stems from an FIR registered by the CCB-I branch alleging offences such as cheating, fraud, forgery, misrepresentation and criminal breach of trust against Sylvanus King Peter, Anitha Bai Sylvanus King Peter and Sally Melissa, the central agency said in a statement.
    According to sources, the CCB FIR was filed last year on the complaint of a former director of the company, B Sriram, who alleged he was "cheated" by the promoters of the company he co-founded with. He later moved the National Company Law Tribunal (NCLT) challenging his removal from the board of the company.
    The company promoter (S K Peter) and some directors subsequently moved the Madras High Court seeking quashing of the police FIR.
    The court transferred the probe from the CCB to the crime branch CID of the state after allegations of threat and coercion were made by the company against CCB officials to settle the matter with the expelled director for a purported sum of Rs 50 crore, the sources had said.
    The probe found, the ED said in a statement, there was "illegal dilution of the complainant's (Sriram) equity from 50 per cent to 10 per cent in Ocean Lifespace India Private Limited, co-founded by the complainant and S K Peter".
    "The appointment of Peter's family members aimed to oust the complainant, utilising a forged signature for their removal," it alleged.
     Additionally, the statement said, it was found that the complainant, instead of honouring the NCLT forum, approached city police (CCB) for settlement, resulting in a one-time settlement of Rs 50 crore, despite the actual claim being Rs 13 crore.
    "This matter is under investigation," the ED said.
    The group was "involved in obtaining accommodation entries (bogus transactions) disguised as genuine purchases and generating cash for disbursals", it said.
     The agency said it seized "unaccounted" cash of Rs 33 lakh and property documents valued at Rs 450 crore apart from electronic devices and "incriminating" documents during the raids.
     The statement did not specify from whose premises these seizures were made.

(This story has not been edited by THE WEEK and is auto-generated from PTI)