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Jaypee Infratech MD Manoj Gaur, who was arrested on charges under the Prevention of Money Laundering Act, was remanded to the custody of the Enforcement Directorate for five days
The ED had conducted searches on May 23, 2025, at 15 locations in Delhi-NCR and Mumbai, including the offices and premises of Jaiprakash Associates Ltd and Jaypee Infratech Ltd. (Image: PTI)
The ED claimed to have busted a massive money laundering scam of Rs 32,825 crore with the arrest of Manoj Gaur, who is the executive chairman of Jaiprakash Associates Ltd and CMD of Jaypee Infratech Ltd.
Gaur was remanded to the custody of the Enforcement Directorate (ED) for five days. Named the prime accused in the scam under the Prevention of Money Laundering Act (PMLA), he allegedly misused and diverted Rs 13,833 crore collected from homebuyers for residential projects towards non-construction purposes.
Officials called this case “one of the largest real-estate money laundering operations in India’s corporate history”, which they said intended to launder public and investor money through multi-layered transactions and inter-company diversions.
WHAT IS THE SCAM?
According to the ED investigation, homebuyers are the biggest victims of this scam as Rs 13,833 crore belonging to them was misused and diverted.
The ED investigation shows that these funds were specifically collected for residential projects but were allegedly redirected for non-construction purposes. Rs 14,599 crore worth of claims have been admitted before the National Company Law Tribunal (NCLT), impacting lakhs of middle-class homebuyers, the probe shows.
This comes as Jaypee Infratech Ltd (JIL) entered insolvency in 2017 and Jaiprakash Associates Ltd (JAL), the flagship company, was admitted to the corporate insolvency resolution process (CIRP) by NCLT Allahabad in June 2024 following a staggering Rs 57,000 crore default.
HOW DID THE SCAM UNFOLD?
The ED investigation shows how the diversion was carried out using fraudulent tactics designed to favour related Jaypee Group entities and shield assets from legitimate creditors.
One significant tactic involved the misuse of philanthropic fronts, as ED sources revealed that charity and corporate social responsibility (CSR) activities were deployed as fronts for laundering funds. Manoj Gaur, serving as the managing trustee of Jaypee Sewa Sansthan, funnelled corporate funds as “CSR donations” even when the parent companies were facing deep financial distress, they said.
The sources said more than Rs 1,208 crore was siphoned off to various related entities and trusts, including Jaypee Sewa Sansthan (Rs 348.2 crore), Jaypee Healthcare (Rs 427 crore), and Jaypee Sports International (Rs 433 crore). The entities engaged in preferential, undervalued, fraudulent and extortionate (PUFE) deals, they said.
They said JAL routed substantial money to its sister entities, such as Jaypee Sports International, Jaypee Infra Ventures, and Jaypee Cement Corporation, even when it was already insolvent, with the intent to strip value and protect the promoters. They added that JIL’s assets were also transferred to JAL via mortgages and inter-company adjustments, deals that were later declared illegal and consequently reversed by the Supreme Court.
The laundering trail also stretched internationally, the sources said. The investigation is tracking offshore layering and property acquisition, revealing that Gaur and his family floated a Cyprus entity, Indesign Enterprises Pvt Ltd (IEPL), which subsequently acquired Ibonshourne Ltd, UK, the owner of a luxury London property, they said.
On May 23, the ED had conducted searches at 15 locations in Delhi, Noida, Ghaziabad, and Mumbai, including the offices and premises of JAL and JIL.
“During the searches, the ED seized a large volume of financial and digital records, along with documents evidencing the offence of money laundering and diversion of funds,” a statement from the agency said.
The ED investigation has established the central role of Gaur in the alleged planning and execution of the fund diversion through a complex web of transactions within the Jaypee Group and its associated entities.
Group Editor, Investigations & Security Affairs, Network18
Group Editor, Investigations & Security Affairs, Network18
November 13, 2025, 19:25 IST
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