Former IAS officer gets five-year jail term in money laundering case

A special court in Ahmedabad has convicted a former Indian Administrative Service (IAS) officer Pradeep Nirankarnath Sharma on charges of money laundering and sentenced him to five years’ imprisonment.

The accused had served as District Collector, Bhuj (Kutch), and Chairman of the District Land Pricing Committee (DLPC) from May 2, 2003, to June 3, 2006.

The court noted that as DLPC chief, he allegedly committed predicate offences by conniving with others to allot government land in Varshmedi, a village in Taluka Anjar (Bhuj) to Welspun India Ltd. and its group of companies. The accused allotted multiple land parcels at rates ranging from ₹15 to ₹18 per square metre, instead of the fixed government rate of ₹78 per square metre, thereby causing a loss of ₹1.2 crore to the exchequer.

Based on the Enforcement Directorate’s (ED) investigation, he was also accused of money laundering by channelling “illegal gratification through his wife Shyamal P. Sharma, who was made a 30% partner in Value Packaging Private Limited, a firm associated with the Welspun Group, without any initial capital investment”.

“An amount of ₹22 lakh, received in her NRO account with Bank of India, and ₹7.5 lakh as a goodwill payment, are alleged to be illegal gratification for extending undue favours to the Welspun Group. The investment of ₹1 lakh made in his wife’s name in January 2008 was used to channelise ₹28,17,407 (including profit share, goodwill amount, and interest) as profit distribution,” the order noted.

’Hawala’ transactions

It was alleged that the funds were used to repay a housing loan for a house in Gandhinagar and to buy agricultural land in Dehgam. The allegations also included using ‘hawala’ transactions through illegal conduits to transfer about ₹1 crore to the U.S., and transfers received in his wife’s U.S. bank accounts from third parties.

“Having regard to the facts of the case that, the accused was an IAS officer holding the post of District Collector and District Magistrate and has misused his official position by indulging into corrupt practice and also indulging himself in offence of money laundering disentitles him for any discretion by directing sentence to run concurrently,” the court observed.

“Both the offences i.e. offence under the Prevention of Corruption Act and the offence under the Prevention of Money Laundering Act are different statutes enacted with specific object…when a person is indulged in committing offence under both the statutes and is found guilty in both the cases which are tried separately, considering the seriousness and gravity of offence, the Court does not find any justifiable reason to direct concurrency of sentence and accordingly, the said request of the accused that his subsequent sentence in this case may be ordered to run concurrently with his previous sentence is rejected,” said the order.