Vinay Aranha of the Rosary Education Group, a charitable trust that runs schools, was arrested by the Central probe agency on March 9 in an alleged loan fraud case
File Photo/PTI
An educationist arrested in a money laundering case obtained loans from banks for the renovation of his schools but ended up spending it on a luxurious lifestyle, purchasing high-end cars and hosting events involving Bollywood celebrities, the Enforcement Directorate told a special court in Mumbai on Friday.
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Vinay Aranha of the Rosary Education Group, a charitable trust that runs schools, was arrested by the Central probe agency on March 9 in an alleged loan fraud case.
He was produced before Special PMLA Judge M G Deshpande, who remanded him in ED custody till March 20.
As per the ED, Aranha is the secretary of the trust and all the other trustees are his kin. The accused controls and is the beneficial owner of all the entities of his family.
The Rosary Education Group had obtained a loan of around Rs 20 crore form Cosmos Bank between between 2015 and 2016, which is basically public money, for renovating a school but the accused siphoned off vast amounts to the tune of several crores for his personal enrichment and to lead a lavish lifestyle, the ED said.
"Investigation has revealed he has been leading a luxurious and highflying lifestyle. He has hosted several events involving Bollywood celebrities. He has recklessly spent funds which were meant for the educational purpose of his schools. He has also purchased several high-end luxury cars worth crores of rupees," the ED told court.
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No books of accounts have been prepared for Rosary Group entities for the last 8-10 years by the accused in order to conceal their financial status, the ED said.
Seeking his remand, the Central probe agency said Aranha needs to be examined thoroughly regarding his income and expenditure as well as diversion of funds.
Opposing the ED's plea, Arnaha's lawyer said the arrest was illegal as proper norms were not followed by the probe agency.
In its order, the court said, "There is no illegality in arresting the accused. I am satisfied that unless ED custody is granted, the investigation will not attain finality."
Rejection of the ED's plea for remand will paralyze and frustrate the probe, which will ultimately frustrate the object of the Prevention of Money Laundering Act, the judge said.
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