Why Did ED Secure 5-Day Custody of Jaypee Infratech’s Ex-CMD Manoj Gaur?
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Synopsis
A Delhi court's decision to grant a five-day custody of Manoj Gaur, the ex-CMD of Jaypee Infratech, to the ED for questioning highlights the escalating scrutiny surrounding the company's alleged financial misconduct. With thousands of homebuyers affected, this case underscores the ongoing battle against financial fraud in India.
Key Takeaways
- Manoj Gaur was granted a five-day custody by the ED for questioning.
- The case involves an alleged money laundering scheme affecting thousands of homebuyers.
- Substantial funds were reportedly diverted from construction projects.
- The investigation was prompted by complaints from homebuyers.
- The ED seized significant evidence during raids on related premises.
New Delhi, Nov 13 (NationPress) A Special Delhi Court on Thursday ordered the five-day custody of Manoj Gaur, the former CMD of Jaypee Infratech Limited, for extensive questioning in connection with a money laundering investigation, according to legal sources.
The Special Court at Patiala House endorsed the ED’s request to interrogate Gaur to disclose critical details of a case involving the alleged misappropriation of crores collected from homebuyers who were never provided their promised flats.
Gaur, who previously served as the CMD of Jaypee Infratech Limited and held the position of Executive Chairman and CEO of Jaiprakash Associates Ltd. (JAL), was apprehended earlier today by the enforcement agency under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002.
The investigation revealed that approximately Rs 14,599 crore was amassed by JAL and JIL from homebuyers, according to claims acknowledged by the NCLT. A significant portion of these funds was allegedly diverted for purposes unrelated to construction, as stated by official sources.
The ED initiated its inquiry against the Jaypee group following multiple FIRs filed by the Economic Offences Wings (EOW) of Delhi and Uttar Pradesh Police in response to complaints from homebuyers associated with the Jaypee Wishtown and Jaypee Greens projects, which alleged criminal conspiracy, fraud, and breach of trust against the company and its executives.
Allegations suggest that funds collected from thousands of homebuyers, intended for the construction and completion of residential projects, were misappropriated, leaving the buyers deceived and their projects unfinished, according to the ED.
Funds were reportedly funneled to affiliated entities and trusts, including Jaypee Sewa Sansthan (JSS), Jaypee Healthcare Ltd. (JHL), and Jaypee Sports International Ltd. (JSIL).
Investigations have also unveiled that Manoj Gaur serves as the Managing Trustee of Jaypee Sewa Sansthan (JSS), which received part of the misappropriated funds, according to the ED.
On May 23, the ED conducted searches at 15 locations associated with Gaur's prominent real estate development companies, Jaypee Infratech Ltd. and Jayprakash Associates Ltd., along with their affiliated entities.
These searches took place across Delhi, Noida, Ghaziabad, and Mumbai, including the offices and premises of Jaiprakash Associates Ltd. and Jaypee Infratech Ltd.. The ED confiscated a substantial volume of financial records, digital data, and documents demonstrating the offense of money laundering and fund diversion.
During the operation, officials recovered cash amounting to Rs 1.7 crore, along with financial records, digital data, and property documents registered under the names of promoters, their family members, and group companies.
IDBI Bank initially lodged a petition against Jaypee Infratech Limited (JIL) in the National Company Law Tribunal (NCLT), Allahabad, after JIL defaulted on a payment exceeding Rs 526 crore. The NCLT commenced the insolvency proceedings on August 9, 2017.
The insolvency case attracted national attention due to the plight of over 21,000 homebuyers who had booked flats in JIL projects and were left stranded as funds were misallocated from construction projects, particularly in Wish Town, Noida.
Point of View
It is crucial to observe that the legal proceedings against Manoj Gaur reflect a broader commitment to holding corporate entities accountable for financial misconduct. The implications of this case are far-reaching, impacting not just the stakeholders involved but also the trust of consumers in the real estate sector. It’s imperative that justice is served to restore confidence in the industry.
NationPress
13/11/2025
Frequently Asked Questions
What is the reason for Manoj Gaur's custody by the ED?
Manoj Gaur is in custody for questioning related to a money laundering case involving the alleged diversion of funds collected from homebuyers.
How much money was allegedly misused in the Jaypee Infratech case?
Approximately Rs 14,599 crore was allegedly collected from homebuyers, with significant amounts diverted for non-construction purposes.
What led to the ED's investigation of Jaypee Infratech?
The ED's investigation was initiated based on multiple FIRs filed by the Economic Offences Wings of Delhi and Uttar Pradesh Police, following complaints from homebuyers.
What are the implications for homebuyers affected in this case?
Thousands of homebuyers are left without their promised flats, raising serious concerns about financial fraud and accountability in the real estate sector.
What actions did the ED take during their investigation?
The ED conducted searches at various locations linked to Gaur's companies and seized cash, financial records, and documents related to money laundering.
