The Enforcement Directorate, which is investigating money laundering charges against IREO Grace Realtech Private Limited former CEO Ramesh Sanka, is likely to frame charges against him in a Gurugram court on July 5.
The investigation is based on a complaint filed by IREO Private Ltd against Sanka for siphoning off money under the Prevention of Money Laundering Act (PMLA) and the resultant FIR No.0058/2020 dated 30/03/2020 U/s 381 & 409 of IPC registered against him.
For those not familiar with the case, here’s how the situation came to such a head: IREO came into being in 2004 in Mauritius as a multinational private fund to develop high quality residential, commercial and hospitality projects in India. IREO established several companies in India, such as IREO Pvt Ltd (IPL), IREO Grace Realtech Pvt Ltd (IGR) and IREO Residences Pvt Ltd, amongst others. These companies were established as separate and distinct entities for launching and developing commercial, residential and hospitality projects in various parts of India.
Ramesh Sanka was appointed IGR Chief Executive Officer-Greater Gurgaon on 03/07/2014 and he resigned on 28/12/2016. Though Sanka was appointed IGR CEO-Greater Gurgaon alone, he was responsible for managing operations of all projects undertaken by IREO companies in Gurgaon and Sohna area, other than hospitality commercial projects.
Sanka had access to all confidential information such as layout plans, municipal approvals, financial statements, customer records, etc. of many projects launched by the various IREO companies in Gurugram and Sohna.
When he resigned, Ramesh Sanka executed an employee separation, confidentiality, non-competition and non-disparagement agreement dated 28/12/2016 with IPL for which he was to be paid Rs 10,37,39,409 as severance fee between 31/12/2016 and 30/09/2017.
Sanka undertook to take necessary precautions to safeguard confidential IPL information, which he had access to, during his employment there and not to disclose the same to anyone until specifically instructed by the company.
He did not raise any grievance regarding the mode and manner of functioning of IREO or its other companies. Further, Sanka did not raise any issue regarding any decision taken by the companies incorporated by IREO till he got the entire severance fee, i.e., 30/09/2017. Sanka also got a refund of the amount he paid for booking two apartments in the Grand Hyatt Residences project of the Company.
Sanka, thereafter, approached IREO’s investor companies, i.e., Axon Capital, situated in New York and represented to them that their investments in IREO, which were invested into various companies established in India, were being misappropriated. He further communicated to Axon Capital that various proceedings will be initiated against several IREO companies so that the funds of Axon Capital can be recovered, for which he will charge consultation fees from Axon Capital.
Following the understanding between Ramesh Sanka and Axon Capital, Sanka filed various claims and litigations against IREO companies and is behind the investigation by various agencies, in return of monetary benefit from Axon Capital. By the aforesaid acts Ramesh Sanka, by using the information made available to him, led the foreign investors of IREO and made large sums of money for pursuing cases against the IREO Companies. He raised invoices to Axon Capital for the various actions instituted by him against the IREO Companies, including taking them to bankruptcy and pushing the Enforcement Directorate to file cases. Thus it can be seen that Sanka filed complaints/proceedings against companies incorporated by IREO to make personal monetary benefit.
Ramesh Sanka made use of the confidential information of the company, i.e., customer data of the company, which he had access to during the course of his employment with IPL, IGR and the company. Sanka started contacting its clients and convinced them that they should hire his services to file complaints against the company and others.
Sanka represented and indemnified TCI and Axon the documents and information so provided by him is not confidential. He was paid fees amounting to US$ 1,000 per hour with minimum of 500 hours resulting in a minimum fee of US$ 5,00,000 and was paid US$ 850 per hour with minimum fee of approximately Rs 12 crore for the stage 2 consulting services during which he misled both TCI & Axon. As per the aforementioned agreement, the legal expenses incurred by Sanka would be re-imbursed by TCI and Axon.
Sanka also incorporated a Limited Liability Partnership, namely, Ghar Samadhan LLP on 15/01/2020 with other two partners Vivek Sehgal and Sumit Kumar, who were associated with IREO Water Front (P) Ltd in order to institute legal proceedings against the company by entering into authorization agreement for recovery of money paid by customers to the company.
The LLP was stated to get success fee equivalent to 35% of the interest/penalty component recovered from the company in violation of various aspects of law, pursuant to the proceedings undertaken by them on behalf of the homebuyer. The homebuyer was further directed to make a payment of Rs 2,36,000 only to the LLP for instituting legal proceedings on behalf of the homebuyer against the company in various forums. The homebuyers have further confirmed that Sanka is in control of the WhatsApp groups created by the LLP, with which they had executed Authorisation Agreements and has been readily issuing instructions to the homebuyers to execute/sign documents in favour of the LLP.
If it is found that the complaint(s) and cases filed by Sanka are false and were filed with vested interest, then it will be an irreparable loss to not only IREO but all the stakeholders i.e, employees, vendors, investors, management, government and the homebuyers. Some homebuyers even suggested that the legislature should implement the 227th Law Commission Report on “Malicious Prosecution” against him.
Speaking on the issue, IREO counsel Gagan Gandhi refused comment since the case was sub-judice.