The Enforcement Directorate has arrested Ajay Ajit Peter Kerkar, the promoter of bankrupt travel company Cox & Kings, in connection with a money laundering case. The company was sent to bankruptcy court in October 2019 after it defaulted on payments. Earlier it was promoted by Kerkar and his family.
Cox & Kings owes Rs 5,500 crore to various banks. The firm was also one of the biggest borrowers of YES Bank when it was under the founder Rana Kapoor, and owes over Rs 2,267 crore to the lender.
Earlier this month, the Central Bureau of Investigation (CBI) filed an FIR against Ezeego One Travel & Tours Limited, a sister company of Cox & Kings, for defrauding YES Bank over Rs 900 crore. The account with an amount of Rs 946.44 crore was reported as fraud to the Reserve Bank of India on February 14, 2020. The CBI filed the FIR based on the complaint of YES Bank.
As per the complaint, the account was reported as a fraud on the grounds of diversion of funds. The agency has booked senior executives Ajay Ajit Peter Kerkar, Urrshilla Kerkar, Neelu Singh, Arup Sen, Manisha Amarapurkar, Pesi Patel and Karthik Venkatraman.
The FIR states that YES Bank gave the credit of Rs 650 crore to Ezeego in 2017, which was increased to Rs 1,015 crore by September 2018. The account was reported as NPA in June 2019 after the travel firm defaulted on payments.
The agency said in the FIR that it was found that the company was involved in the diversion of funds to Cox & Kings. The audit report shows the firm took a loan of Rs 150 crore from YES Bank to clear the loan, it said. However, it was never paid and turned NPA in 2019.
Ezeego One Travel & Tours Limited was incorporated in 2006 and offered travel products from booking flights, hotels and holiday packages to a host of other transport and travel services in the Indian market.
Meanwhile, the CBI has reportedly received another fraud complaint against Cox & Kings from State Bank of India. The complaint is currently being examined.
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