Is Ansal API chief the next Mallya?

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ansal--Cover-story-New3The Narendra Modi government has fired the biggest salvo in its bold and courageous war against black money. According to the Prime Minister, this is just the beginning. The government would eventually target all other forms of assets (including real estate) that are used by people to park black money and coupled with the implementation of Goods and Services Tax (GST), this will help control the creation of black money.

We can only imagine that a government that can dare to change 86 percent of country’s currency could go to any length to hit at black money to boost government revenue, crackdown on rampant tax evasion, curb illegal financial transactions and stamp out terrorism.

Tehelka, over 15 tumultuous years, has striven to be a free, fair and fearless media house believing in public interest journalism. Joining the India’s war against black money, we present our first piece involving a real estate giant.

The Union government has received a complaint against Chairman and Vice-Chairman of Ansal API Group alleging generation of black money of hundreds of crores and siphoning them overseas. The complaint alleges that the father-son duo are “planning to flee the country”.

The complainant has demanded that the government give instructions to all agencies including Income Tax Department, Central Vigilance Commission, Enforcement Directorate, Securities and Exchange Board of India, Registrar of Companies, National Green Tribunal, Competition Commission of India to investigate the matter to unearth black money earned by these tax evaders over the years.

Tehelka team of reporters that worked on the story found that this seems to be a case of massive money laundering and ‘hawala’ activities of Chairman, Vice-Chairman and MD and CEO of Ansal Properties and Infrastructure Ltd (Ansal API) Group.

Ansal
Sushil Ansal

Tehelka sent a detailed questionnaire to Sushil Ansal at his office (115, Ansal Bhawan, 16 Kasturba Gandhi Marg, New Delhi-110001) on 7 November and again on 15 November seeking his version. The set of questions was duly received by his office but there was no reply to any of these questions till date.

Documents in our possession show that by misusing their positions in the Group, these persons had made thousands of crores in cash through sale of plots, flats, both residential and commercial in various colonies developed by them over the years.

One such example is sale of industrial plots in Pioneer Industrial Park, Manesar. While the listed price was 12,000 per sq yard, the amount in cheques taken varied from 2,500 per sq yard to 5,390 per sq yard as the remaining amount was taken in cash. Significantly all these transactions were duly signed by concerned General Manager and Chairman Sushil Ansal (See copy of the internal document showing sale of seven such plots in Pioneer Industrial Park, Manesar).

That the Group is on a selling spree gives credence to the allegations that the Chairman and his son, the Vice-Chairman, are on the verge of fleeing the country. They have recently sold the prestigious Maple Club in Palam Vihar, Gurugram for 32 crore where a cheque amount of only 16 crore was taken. They have already sold a large number of assets including schools, educational institutions, community clubs,etc.

In April/May this year, Ansals sold Chiranjiv School along with a play school, a 5.5 acre property in Palam Vihar, Gurgaon, another school in Palam Vihar in one acre and a yet another school in Sushant Lok, Gurugram for an allegedly total deal of 200 crore. However, only a 72 crore payment has been taken by way of cheque and remaining 128 crore in cash.

Ironically, the circle rate (minimum rate fixed by the Collector for registration) was 30,000 per sq yard and as such the value of land alone should have been 150 crore and total covered area of 3 lakh feet at a nominal 1,200 per sq ft should have cost at least 36 crore. Not only that, the premium school has about 4,000 students on its rolls and that would have fetched huge additional sums.

Enquires reveal that two schools — Gems International, Palam Vihar and one school at Lucknow, Sushant Golf City, are currently on sale. They have fixed sale price of 32 crore and 25 crore respectively. Last year a portion of another family-owned 4.83-acre farmhouse at No. A-1, Pushpanjali, Delhi measuring 1.13 acres was sold to Julian Infracon Pvt Ltd (owned by one Avdesh Goel) for 22 crore and registry was done only for an amount of 5 crore.

The remaining portion of the farm measuring 3.70 acres was sold in April this year to Yash Infocom Pvt Ltd for a sum of 70 crore where the registry was done for 6 crore and remaining amount of 64 crore was allegedly taken as cash.

Pranav Ansal
Pranav Ansal

During enquiries it was found that both Sushil Ansal and his son Pranav Ansal are laundering this cash in their foreign accounts maintained in tax havens as well as in UK and Singapore and in purchase of properties in Singapore, UK and Dubai including a hotel on Sheikh Zayed Road in Dubai and a 50 crore apartment in UK’s tallest residential building ‘Shard’.

That both father and son have been visiting Singapore and Dubai very frequently suggests they may have been illegally parking funds there.

Enquiries also reveal that the Ansal family is also laundering big money through foreign accounts of Sushil Ansal’s grandchildren — Pranav Ansal’s children, son Ayush Ansal and daughter Anushka Ansal who are maintaining foreign bank
accounts in HSBC, Barclays Bank, Natwest, Standard Chartered etc in Singapore, Dubai and UK. They enjoy NRI status now.

Enquiries suggest that MD and CEO of the company has allegedly utilised illegal cash in developing a hi-tech township of more than 500 acres on NH-24, Ghaziabad whose worth is about 1,500 crore.

Despite Ansal API being a public listed company, the company has entered into various one sided agreements with companies promoted by relatives of Sushil Ansal like Vipin Luthra (son-in-law) of Westbury Hospitality and Miglani (father-in-law of Pranav Ansal) of Uttam Galva. Such transactions have led Ansal API to incur losses running into crores.

An example of such a transaction is sale of 15 villas in Sushant Golf City, Lucknow at heavily discounted price. Also various subsidiary and family-owned companies have invested and bought shares in the companies of Vipin Luthra, for example 4,40,000 shares of 10 face value in Westbury Hotels Pvt Ltd which have been bought by Delhi Towers and Estates Pvt Ltd.

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Banks that mortgaged properties of Ansals despite earlier mortgages

Punjab National Bank

Jammu and Kashmir Bank

Yes Bank

Allahabad Bank

Bank of Maharashtra

Bank of India

Indian Bank

Federal Bank

Tamilnad Bank

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The Ansal API Group has been constantly misappropriating funds taken on loan from banks. For example, 239.54 crore was misappropriated from funds taken from the HDFC bank. A simple multi-bank investigation in accounts at Punjab National Bank, Jammu and Kashmir Bank, Yes Bank, Allahabad Bank, Bank of Maharashtra, Bank of India, Indian Bank, Federal Bank and Tamilnad Bank would reveal how the same properties have been mortgaged to various banks and many mortgaged properties already sold on forged sale deeds to gullible investors.

Also, huge funds have been brought into a large number of subsidiary firms of Ansal API through the fake sale of shares at extremely high premiums when the companies were incurring big losses. Hundreds of crores of rupees were routed into these companies through shell companies floated in Kolkata and Delhi.

The modus operandi was simple: Crores of rupees were deposited in accounts of bogus companies floated in Kolkata with no business activities and then cheques issue from Kolkata companies to other bogus companies floated in Delhi and owned by wives of Sushil and Pranav, namely Kusum and Sheetal.

‘Benami’ companies used to siphon off funds

1 Prime Maxi Promotion Services
2 Orchid Realtech
3 Ambience Hospitality
4 Knowledge Tree Infrastructure
5 Sparkle Estate
6 Palace Hotels (India)
7 Bajrang Realtors
8 Chandi Properties
9 Plaza Software
10 Prime Golf Ranking
11 Singa Real Estates
12 Star on Net.Com
13 Julian Inferacon
14 Green Max Estates
15 Amba Bhawani Properties
16 Believe Developers and Promoters
17 Bluebell Infrastructure
18 BG Agritech
19 Chiranjiv Investment
20 Anupam theatres and Exhibitors
21 Sampark Hotels
22 MKR Buildwell
23 Kalka Properties
24 Chamunda Properties
25 Sky Scraper Infra Projects
26 Caliber Properties
27 Mid Air properties
28 Badrinath Properties
29 Sithir Housing and Construction

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Shady deals:

1 Industrial plots in Manesar (Gurgaon)

2 Maple Club, Palam Vihar, Gurgaon

3 Chiranjiv School, Palam Vihar, Gurgaon/
Sushant Lok Gurgaon

4 Gems International School, Palam Vihar
5 Sushant Golf City School, Lucknow

6 Pushpanjali Farm House Delhi

7 Golf Vilas, Sushant Golf City, Lucknow

8 Residential units in Palam Vihar

9 Residential plots at Mulberry Homes

10 Farm Houses at Aravali farms

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Money talks: ‘Shard’, UK’s tallest building, in which the Ansals have bought a `50 crore apartment.

A fraud is clearly being played on shareholders as a large number of shares of public listed Ansal API are being bought by Ansal API subsidiary companies, companies promoted by Kusum and Sheetal Ansal as well as benami companies without any intimation to Sebi and the money so raised is loaned back to the promoter companies of Sushil and Pranav Ansal.

The enquiries reveal that business transactions and fraudulent activities are being carried out allegedly by Ansals while signing authorities are directors, thus protecting them from legal action. Two senior officials of Ansal API are directors in at least a dozen companies belonging to the group.

Across the country, hundreds of FIRs have been lodged against Ansal API or subsidiary companies but no action has been taken against anyone. FIRs related to selling of plots, land, apartment to customers without owning or having rights to the land, sale of 160 units of residential units in Palam Corporate on a commercial licence, sale of 17 residential plots in Mulberry Homes where the company till date has no land, etc.

How Ansal API defrauds shareholders and Income tax authorities could be understood from projects in Uttar Pradesh in the year 2011-12, wherein only an amount of 11.24 crore was taken as profit whereas actual profit was over 125.67 crore. Of this 65.34 crore was shown as loss from Sushant Golf City project while 46.07 crore was shown as loss in plots of the parent company, 13.76 crore was shown as losses in the built up units and 5.53 crores was shown as loss in the Celebrity Gardens complex.

Enquiries further reveal that more than 100 crore was channelled to three charitable organisations — Chiranjiv Charitable Trust, Sushil Ansal Foundation and Kusumanjali Foundation.

Also, as per the agreement with the UP government, 5,000 units were to be developed aDocs affordable housing units for the economically weaker sections in Lucknow and another 2,000 such units were to be developed by Ansal API in their projects near Dadri, Agra, Meerut and Ghaziabad. As an example, under the policy of the government, 10 percent (312 units) and 10 percent LIG houses (330 units) were launched and sold out in the Lucknow project. However, they did not own any of these units which clearly is a fraud played both on the government as well investors.

In the Aravalli farms which is situated in a designated forest area of Gurugram, Ansal API illegally sold out over 100 farms. In fact, more than 100 FIRs have
registered but no action is being taken against Ansals for reasons best known to police.

The complaint sent to the government alleges that benami apartments in properties such as Dhawan Deep at Jantar Mantar Road and Upasana at Hailey Road are stacked with cash transaction receipts. Since the government has already received complaints in this connection demanding investigation by various enforcement and regulatory agencies, Ansal API’s would be a test case for the Modi
government, which is fighting tooth and nail against the menace of black money.

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Uphaar fire still burns in hearts

A new book from Penguin Random House records the struggle by victims’ families to bring the Ansals — owners of the cinema hall to justice. Swati Gupta reviews the book and finds it makes compelling reading

Trial by Fire by Neelam and Shekhar Krishnamoorthy is the story of the excruciating struggle by parents of Unnati (17) and Ujjwal (13), who lost their lives on 13 June 1997.

Through this book, Neelam and Shekhar bring their children back to life and speak of the long, endless struggle they faced in trying to get the Ansal brothers — owners of Uphaar cinema — convicted.

On 13 June 1997, a massive fire had taken place in the Uphaar cinema in posh South Delhi.

On that fateful day, a swirling mass of thick smoke entered the balcony section of the well-known cinema hall Uphaar located in posh south Delhi at 4.55 pm during the screening of the popular movie Border. With most exits unavailable and no ushers to help, the people seated in the balcony found themselves trapped.

By 7 pm, 57 people had died and 103 were seriously injured in the ensuing stampede. Two more persons died later in the hospital.

They were gone, but thus began a painful quest for justice for their families, united under the auspices of the ‘Association of Victims of Uphaar Fire Tragedy’ (AVUFT).

The fight:

Owners of the cinema, real estate barons Sushil and Gopal Ansal, in August this year escaped being jailed in connection with the tragedy with the Supreme Court asking them to pay a fine of 30 crore each and restricting their jail term to the period already served by them.

The apex court overturned the pleas of CBI and the victims’ association. While Sushil had spent only five months in prison, Gopal was in jail for just four months immediately after the tragedy.

Earlier, the Supreme Court in 2014 had held the Ansals guilty but differed on the quantum of sentence to be awarded to them.

It had concurred in holding that there was “contemptuous disregard” of civic laws on part of the Ansals that led to the tragedy as they were “more interested in
making money than ensuring safety of people”.

The Delhi High Court in 2008 had awarded one-year jail term to both Sushil and Gopal.

A public cause

In this book, the Krishnamoorthys highlight the never-ending greed and intentional ignorance of public safety laws which previously resulted in many tragedies such as the Bhopal gas tragedy in 1984 where over 10,000 people lost their lives and many more such tragedies that clearly were case of gross negligence of standard safety norms. They categorically mention the scale of destruction and deaths of the such accidents caused.

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They accentuate that in this grim scenario, incidents of such catastrophic magnitude are bound to recur since there is no legal deterrence that can instead fear in the hearts of wrongdoers.

The 19-year fight of AVUFT proves that those deaths could have been avoided and if we, as a society, do not acknowledge the terrible greed and negligence that exists, and choose not to act against the gross violations of the safety norms in public spaces, incidents like the Uphaar fire are bound to recur.

But the fight for the victims of Uphaar cinema fire tragedy seems endless, with no closure. This book collates and analyses what happened to the preparators of such unpardonable crimes.

Neelam and Shekhar Krishnamoorthy, who lost their teenaged children, never gave up their fight for justice to bring those who were responsible for the tragedy to book. Their fight, which began 19 years ago, continues till date, with ample help from the media.

Trial by Fire is the story of how the system failed them one step at a time and how, despite the odds, they still refuse to back down. The book depicts all their agony, pain and valor and their will to continue fight for justice and as it turned out that their fight was more with the system than a personal vendetta.

The views of Krishnamoorthys are an eye-opener for all Indian citizens and the story of their struggles is an inspiration — to overcome adversity with courage, to always fight the good fight.

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     Rich unlike us

22ABelow is an extract from Trial by Fire, which describes courtroom battles over 19 years to punish the guilty, — who served only a few months incarceration.

This extract is being carried with permission of Penguin Books India

Extract

The most arduous task ahead of us was to follow up on the criminal trial. The Indian criminal justice system is heavily loaded against the victims and favours the accused, especially if the accused are rich, powerful and corrupt. Since the Ansals come from a very influential section of society, they were willing to go to any length to delay and derail the trial. They were being represented not by one or two lawyers, but a battery of high-profile, competent lawyers. On the other hand, the victims, that is us in this case, werebeing represented by a public prosecutor engaged by the CBI, whose profile was certainly lower than the Ansals’team of lawyers. Thus, we were at a disadvantage.

During the committal stage of the criminal trial in the court of the magistrate, the defence counsels sought adjournments on the grounds that they had not been supplied with the complete set of documents used by the prosecuting agency. We sought legal advice to understand why the case was not progressing and were told that under section 207 of the CrPC, the accused have to be furnished with all the documents that the prosecution relies upon in the case, as well as the statements of witnesses. We were also told it was a minor procedure, which should not take more than two to three hearings. But the problem persisted for over a year. The counsels for the Ansals also moved an application for separating the trial as the accused had been charged under different sections of the Indian Penal Code. This request was turned down by the magistrate.

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Anguish undimmed: For Neelam Krishnamoorthy, there is no closure

In October 1998, the accused filed an application for the release of Uphaar Cinema so that they could proceed with their business. This application too was dismissed by the magistrate. When the court was scheduling the next date of hearing, the lawyers wanted a date after Diwali, stating it was the festival season and they wanted to spend time with their families.

The lawyers and the accused exchanged greetings while leaving the courtroom, oblivious of the fact that the families of the victims were present in the courtroom. Shekhar and I were transported back to how we used to celebrate Diwali with Unnati and Ujjwal. The children always looked forward to the festival with a lot of excitement and were very enthusiastic about shopping for the occasion. Our house used to be brightly lit and we were always joined by a lot of family and friends for the celebration. We do not look forward to Diwali any more, or any other cause for celebration for that matter — birthdays, anniversaries, festivals, etc., only depress us further. They are constant reminders that we have little to celebrate and no one to celebrate with. We can only wish the children were with us to celebrate. As we left the courtroom that day, it was difficult for us to keep our emotions and tears under control until we could get some privacy.

Around this time, during one of the hearings, the leading defence counsel for the Ansals had the temerity to call the tragedy an act of god. He even compared the fire to the Bhopal gas tragedy and blatantly asked why such a hue and cry was being created when, after all, only fifty-nine lives were lost. Over the years, our continuing battle for justice had prepared us to face bruising events at every turn, but, at that juncture, when we were relatively new to the ways of the court and the pain, we could not express the sense of outrage and shock we experienced on hearing this dastardly argument. Imagine how distressed we were to hear that our loved ones were being referred to as mere numbers! We wondered how this could be called an act of god.

Unable to control ourselves, we tried addressing the court ourselves, but were rebuked by the defence counsels, who stated that we have no locus standi (the right or capacity to bring an action or to appear in a court). On making inquiries about our role in the criminal trial, we were told that as victims, we could engage a lawyer, but he could not extend his role beyond assisting the public prosecutor, and only if the prosecutor were agreeable to it. We realized then that this is a
major drawback in the system.

The urgent need for a public prosecutor who was competent, could match the wisdom of the defence counsels, and, if required, outmanoeuvre them, became starkly apparent to us. Our counsel advised us to be vigilante litigants and ensure that we schedule a conference with the arguing lawyer a day before our matter was listed. In one of his initial meetings with us, Tulsi referred to an old Hindi proverb, muddai sust gavaah chust, which means: witness active, defendant inactive. He was warning us that we needed to be alert all the time, and never lose our momentum and intensity.

We were now faced with the question of who would spare the time to follow up on the cases, both civil and criminal, on behalf of AVUT. Shekhar and I decided that we would follow up the cases between us, since we had decided to dedicate our lives to getting justice for our children. Moreover, we had
realized that this was especially relevant in the criminal trial, as it would be the state that represented the victims.

We understood early on that it was not enough to merely attend the court proceedings. The need of the hour was to coordinate closely with the CBI to ensure proper progress in the case. We met senior officers of the CBI and
requested them to expedite the process of furnishing documents to the
accused, and also appoint a special public prosecutor so that we would be
well represented.

The case was finally committed to the sessions court on 4 January 1999. This whole process took thirty hearings. Normally, the simple clerical process of making copies of documents to be provided to each of the accused should not take more than two to three hearings.

As we have mentioned earlier, it took thirty hearings in our case. Delays were created on the basis of the most flimsy excuses — sometimes, photographs included in the evidence were declared not clear enough, while at other times the documents and the site plans of Uphaar Cinema were declared to be illegible.

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Readers React

Here is another fraud by Ansal API

 With reference to the cover story “Is Ansal the next Mallya?” by Tehelka Bureau (December 15)

Thanks for bringing out the truth about Ansal API conglomerate. I would like to add another fraud committed by Ansal API under the name of their residential project – Sushant Megapolis, Bodaki Greater Noida.

* The project was launched in 2008-2009 under the garb of Hitech township (http://www.sushantmegapolis.com)

* They did not have land when they launched this project, till now they only have a fraction of land but have accepted booking for entire 2500 acres

* After more than 8 years of duping people and collecting money, no deliveries have taken place

* The company refuses to refund money

* Investors are fighting legal battles with Ansal API to get their money back, but there is no outcome yet

* The representatives refuse to talk or provide any details

Pranav Ansal’s promise: https://www.youtube.com/watch?v=jyptoPtFVxo

Buyers’ plight: https://www.youtube.com/watch?v=esK5XJ7VhmE

Reality: https://www.youtube.com/watch?v=xcOhcHlCy5U

Buyers Union: https://www.facebook.com/groups/ansalapimegapolis

by  Ashish Tanwar

Editor’s note: More information on such frauds is pouring in as our bureau is doing a detailed investigation on the subject

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