In a fateful development exactly a month after the Eknath Shinde-BJP alliance ousted the Shiv Sena-led government in Maharashtra, Sena's most vocal leader, Sanjay Raut, was arrested by the Enforcement Directorate (ED) in a money laundering case at midnight on Monday, 1 August.
The case in which Raut has been arrested concerns the crucial Patra Chawl Development project that has been underway in Maharashtra for over a decade.
The ED has alleged a scam of a whopping Rs 1039.79 crore in the project, and part of the mammoth account was traced back to properties owned by Sanjay Raut's wife, Varsha Raut.
Here's a lowdown on the Patra Chawl land scam case.
Explained: Patra Chawl Land Scam & Money Trail That Led to Sanjay Raut's Arrest
1. What Is the Patra Chawl Redevelopment Project?
Patra Chawl, also known as Siddharth Nagar, is located in Goregaon. The residential colony has a total of 672 houses, spread over an area of 47 acres.
In 2007, the Maharashtra Housing and Area Development Authority (MHADA) awarded the Patra Chawl project – to rehabilitate 672 tenants and to redevelop the locality – to Guru Ashish Construction Private Limited (GACPL), a sister concern company of HDIL (Housing Development and Infrastructure Ltd).
A tripartite agreement was signed between GACPL, MHADA, and the tenants' society.
The company was given the contract to provide new homes to the 672 tenants of the chawl, hand over about 3,000 flats to the MHADA, and sell the remaining area of the 47 acres to private developers.
Further, the developer had to pay rent to all 672 tenants every month till the completion of the project. However, the rent was paid only till 2014-15.
Due to the non-payment of rent, delay, and alleged irregularities, MHADA had issued a termination notice to the developer in January 2018, leaving the project in a lurch.
The stalled project was resumed under the directions of the then Maharashtra Chief Minister, Uddhav Thackeray, in February this year.
Expand2. What Is the ED Case?
The ED had lodged an Enforcement Case Information Report (ECIR) over alleged irregularities in the Patra Chawl redevelopment project in February.
The central agency claims that its probe found that in contravention of the agreement with the MHADA and the tenants' society, Guru Ashish Construction sold a parcel of the land to private entities without building the portion for rehabilitating the chawl residents.
In a statement in April, the ED alleged that GACPL sold the floor space index (FSI) to nine private developers.
"The directors of M/s Guru Ashish Constructions mislead MHADA and managed to sell the FSI to 9 developers and collected approx. Rs 901.79 Crore without constructing the rehab portion for 672 displaced tenants and MHADA portion."
Enforcement DirectorateDuring the relevant time period, Pravin Raut, Rakesh Kumar Wadhawan, and Sarang Wadhwan were the directors of GACPL, as per the statement.
The ED further said in its statement that the construction company acquired an amount of Rs 138 crore from flat buyers under a project named Meadows.
"Further M/s Guru Ashish Construction Pvt. Ltd have also launched one project namely Meadows and took the booking of amount around Rs 138 Crore from flat buyers. The total proceeds of the crime generated by Directors of M/s Guru Ashish Constructions Pvt. Ltd through the illegal activities were approx. Rs 1039.79 Crore," the ED statement noted.
On 2 February, Pravin Raut was arrested for his involvement in money laundering in connection with the redevelopment project, on the basis of FIR registered by Economic Offences Wing (EOW).
Expand3. Where Did the Money Go?
The hefty amount of over a thousand crores was transferred to close associates of GACPL, as per the ED.
As per the investigation into the money trail, around Rs 100 crore were transferred from HDIL to the account of Pravin Raut, a close aide of of Sanjay Raut.
This amount were further diverted by Pravin Raut to various accounts of his close associates, family member, business entities etc. This includes the wife of Shiv Sena leader Sanjay Raut.
Expand4. How Is Sanjay Raut Involved?
An ED statement alleges that during 2010, part of the proceeds of the alleged money laundering, amounting to Rs 83 lakh, was received by Sanjay Raut's wife Varsha. The amount was transferred to her by Madhuri Raut, wife of Pravin Raut.
This amount was utilized by Varsha Raut for the purchase of a flat in Dadar. Further, 8 plots of land at the Kihim beach in Alibaug were also purchased under the names of Varsha Raut and Swapna Patkar, wife of Sujit Patkar, who is a close associate of Sanjay Raut.
"It is also revealed that after initiation of ED investigation the amount of Rs 55 Lakhs was transferred by Smt Varsha Raut to Mrs Madhuri Raut. There are also various other transactions," the financial watchdog stated.
Expand5. What Action Has ED Taken Against Sanjay Raut?
Sanjay Raut was arrested in the money laundering case linked to the Mumbai chawl after the ED conducted a nine-hour search at his Bhandup bungalow, during which Rs 11.5 lakh in cash was seized.
Raut was subsequently summoned for questioning at the agency's office. After six hours of interrogation, he was arrested near midnight. He was taken into custody at 12:05 am on Monday under the PMLA, as he was not cooperating in the probe, the officials claimed.
The agency is understood to have questioned the Sena leader about his "business and other links" with Pravin Raut and Patkar and also about the property deals involving his wife.
In April, the ED had provisionally attached assets worth over Rs 11.15 crore belonging to his wife Varsha Raut and two of his associates, as part of the investigation.
This included land held by Pravin Raut, a Dadar flat held by Varsha Raut, and eight plots at Kihim beach in Alibaug jointly owned by Varsha Raut and Swapna Patkar.
Meanwhile, on Sunday, the Mumbai Police registered a fresh FIR against Sanjay Raut on the charge of insulting the modesty of woman, on the complaint lodged by a witness in the ED case.
The complaint was lodged at Vakola police station by the witness, Swapna Patkar, who has claimed she was given rape and murder threat in a typed paper, which was inserted in a newspaper delivered to her on 15 July.
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Expand
What Is the Patra Chawl Redevelopment Project?
Patra Chawl, also known as Siddharth Nagar, is located in Goregaon. The residential colony has a total of 672 houses, spread over an area of 47 acres.
In 2007, the Maharashtra Housing and Area Development Authority (MHADA) awarded the Patra Chawl project – to rehabilitate 672 tenants and to redevelop the locality – to Guru Ashish Construction Private Limited (GACPL), a sister concern company of HDIL (Housing Development and Infrastructure Ltd).
A tripartite agreement was signed between GACPL, MHADA, and the tenants' society.
The company was given the contract to provide new homes to the 672 tenants of the chawl, hand over about 3,000 flats to the MHADA, and sell the remaining area of the 47 acres to private developers.
Further, the developer had to pay rent to all 672 tenants every month till the completion of the project. However, the rent was paid only till 2014-15.
Due to the non-payment of rent, delay, and alleged irregularities, MHADA had issued a termination notice to the developer in January 2018, leaving the project in a lurch.
The stalled project was resumed under the directions of the then Maharashtra Chief Minister, Uddhav Thackeray, in February this year.
What Is the ED Case?
The ED had lodged an Enforcement Case Information Report (ECIR) over alleged irregularities in the Patra Chawl redevelopment project in February.
The central agency claims that its probe found that in contravention of the agreement with the MHADA and the tenants' society, Guru Ashish Construction sold a parcel of the land to private entities without building the portion for rehabilitating the chawl residents.
In a statement in April, the ED alleged that GACPL sold the floor space index (FSI) to nine private developers.
"The directors of M/s Guru Ashish Constructions mislead MHADA and managed to sell the FSI to 9 developers and collected approx. Rs 901.79 Crore without constructing the rehab portion for 672 displaced tenants and MHADA portion."Enforcement Directorate
During the relevant time period, Pravin Raut, Rakesh Kumar Wadhawan, and Sarang Wadhwan were the directors of GACPL, as per the statement.
The ED further said in its statement that the construction company acquired an amount of Rs 138 crore from flat buyers under a project named Meadows.
"Further M/s Guru Ashish Construction Pvt. Ltd have also launched one project namely Meadows and took the booking of amount around Rs 138 Crore from flat buyers. The total proceeds of the crime generated by Directors of M/s Guru Ashish Constructions Pvt. Ltd through the illegal activities were approx. Rs 1039.79 Crore," the ED statement noted.
On 2 February, Pravin Raut was arrested for his involvement in money laundering in connection with the redevelopment project, on the basis of FIR registered by Economic Offences Wing (EOW).
Where Did the Money Go?
The hefty amount of over a thousand crores was transferred to close associates of GACPL, as per the ED.
As per the investigation into the money trail, around Rs 100 crore were transferred from HDIL to the account of Pravin Raut, a close aide of of Sanjay Raut.
This amount were further diverted by Pravin Raut to various accounts of his close associates, family member, business entities etc. This includes the wife of Shiv Sena leader Sanjay Raut.
How Is Sanjay Raut Involved?
An ED statement alleges that during 2010, part of the proceeds of the alleged money laundering, amounting to Rs 83 lakh, was received by Sanjay Raut's wife Varsha. The amount was transferred to her by Madhuri Raut, wife of Pravin Raut.
This amount was utilized by Varsha Raut for the purchase of a flat in Dadar. Further, 8 plots of land at the Kihim beach in Alibaug were also purchased under the names of Varsha Raut and Swapna Patkar, wife of Sujit Patkar, who is a close associate of Sanjay Raut.
"It is also revealed that after initiation of ED investigation the amount of Rs 55 Lakhs was transferred by Smt Varsha Raut to Mrs Madhuri Raut. There are also various other transactions," the financial watchdog stated.
What Action Has ED Taken Against Sanjay Raut?
Sanjay Raut was arrested in the money laundering case linked to the Mumbai chawl after the ED conducted a nine-hour search at his Bhandup bungalow, during which Rs 11.5 lakh in cash was seized.
Raut was subsequently summoned for questioning at the agency's office. After six hours of interrogation, he was arrested near midnight. He was taken into custody at 12:05 am on Monday under the PMLA, as he was not cooperating in the probe, the officials claimed.
The agency is understood to have questioned the Sena leader about his "business and other links" with Pravin Raut and Patkar and also about the property deals involving his wife.
In April, the ED had provisionally attached assets worth over Rs 11.15 crore belonging to his wife Varsha Raut and two of his associates, as part of the investigation.
This included land held by Pravin Raut, a Dadar flat held by Varsha Raut, and eight plots at Kihim beach in Alibaug jointly owned by Varsha Raut and Swapna Patkar.
Meanwhile, on Sunday, the Mumbai Police registered a fresh FIR against Sanjay Raut on the charge of insulting the modesty of woman, on the complaint lodged by a witness in the ED case.
The complaint was lodged at Vakola police station by the witness, Swapna Patkar, who has claimed she was given rape and murder threat in a typed paper, which was inserted in a newspaper delivered to her on 15 July.
(At The Quint, we question everything. Play an active role in shaping our journalism by becoming a member today.)