Kamal Ghorui
NEW DELHI: Continuing its operation against alleged fraudulent corporate resolutions of bankrupt companies and money laundering activities during insolvency proceedings at National Company Law Tribunal (NCLT), ED on Thursday arrested Arvind Kumar, a former resolution professional (RP) of Richa Industries Ltd.Kumar, who was the company’s RP between 2018 and 2025, is the first ever RP to be arrested by an enforcement agency on charges of collusion with promoters of a bankrupt company, siphoning off assets of a company under insolvency, and laundering proceeds of crime. A court has remanded him in eight days of ED custody.In Jan, ED had arrested the company’s former promoter Sandeep Gupta. The agency had then claimed Gupta had not only cheated banks of hundreds of crores, but also allegedly laundered valuable assets of the company, when it went to insolvency, by diverting them to shell entities floated by him and his associates.Kumar’s arrest came two days after NCLT’s Delhi bench withdrew its insolvency resolution award of Alchemist Ltd after ED produced evidence of fraud against the corporate resolution where a sister concern of the company under insolvency was brought in as part of the committee of creditors (CoC) with 97% voting share to fraudulently acquire assets.In the Richa Industries case, the corporate insolvency resolution process, initiated in 2018, reached a dead end in absence of an approved resolution plan, leading NCLT to order liquidation on June 11 last year. A liquidator was appointed and the sale of Richa Industries yielded Rs 40 crore to Indian Overseas Bank and Union Bank against their admitted claims of Rs 696 crore, approximately a 94% haircut, ED said.“Bank records (of Kumar) further showed unexplained cash deposits exceeding Rs 80 lakh in his personal accounts during the period of his appointment, along with credits of over Rs 1 crore received from his related parties who had earlier been beneficiaries of payments from the company,” according to ED’s investigation report.The agency said that “the arrested RP was a beneficiary of the proceeds of crime generated from the original bank fraud, projecting illicit funds as legitimate receipts under the guise of CIRP-related operations”.According to ED, the RP adopted a modus operandi, allegedly followed in many other NCLT resolution cases where constitution of CoC were “manipulated by admitting sham and inflated claims of unsecured financial creditors, many of them dummy/proxies controlled by the ex-promoters who masterminded the bank fraud, thereby handing decisive voting power to the suspended promoters and sidelining genuine public sector bank creditors”.
