Ruby Mills Under ED Scrutiny, Pays ₹1.01 Billion to Shreem Corp Resolution Professional, Disputes Fraud Claims

The Ruby Mills Ltd. is at the center of a high-profile legal and regulatory storm after the Enforcement Directorate (ED) filed a prosecution complaint under the Prevention of Money Laundering Act (PMLA) against the company and its Managing Director. In parallel, Ruby Mills has made a significant payment of ₹1.01 billion to the resolution professional of Shreem Corporation (formerly Rajput Retail Ltd.), while maintaining that the underlying dispute and alleged fraudulent activities pertain solely to Rajput Retail and not Ruby Mills itself.

 

Key Highlights

ED Files PMLA Complaint: The Enforcement Directorate has initiated prosecution under the PMLA against The Ruby Mills Ltd. and its Managing Director, intensifying regulatory scrutiny on the company.

 

Company's Response: Ruby Mills announced it is actively exploring legal remedies to challenge the ED’s complaint, signaling a robust defense strategy against the allegations.

 

Dispute Details: The company clarified that the core dispute and all alleged fraudulent activities are linked exclusively to Rajput Retail (now Shreem Corporation), not to Ruby Mills or its management.

 

Settlement Payment: Ruby Mills confirmed the payment of ₹1.01 billion (₹101 crore) to the resolution professional of Shreem Corporation, effectively settling the claims in the ongoing insolvency proceedings. This payment followed directives from the National Company Law Tribunal (NCLT) and included amounts previously held by State Bank of India.

 

Regulatory Filings: The company has kept stock exchanges updated on all major developments, including board meeting outcomes and compliance with SEBI regulations.

 

Sector Context: The ED has recently stepped up enforcement under PMLA, with a high conviction rate in concluded cases, but Ruby Mills maintains its stance that it is not directly implicated in the alleged fraud.

 

What’s Next?

Ruby Mills is expected to mount a legal challenge to the ED’s complaint while continuing to emphasize its non-involvement in the underlying fraudulent activities attributed to Rajput Retail. The company’s swift compliance with NCLT orders and transparent communication with stakeholders underscore its efforts to protect its reputation and business continuity.

 

Source: IANS, Moneycontrol, Company Filings, ED Statements