The Enforcement Directorate (ED) has arrested YS Reddy, deputy director (town planning) of Vasai-Virar City Municipal Corporation (VVCMC) and native of Hyderabad, along with three others, in a major money laundering case linked to unauthorized construction and corruption in Vasai-Virar.
On August 13, the ED took into custody former VVCMC commissioner and IAS officer Anil Kumar Khanderao Pawar, builders and former corporator Sitaram Gupta and builder Arun Gupta, under the Prevention of Money Laundering Act (PMLA). Earlier, the agency conducted searches in Hyderabad connected to this case.
The ED seized assets totaling approximately Rs47 crore, including Rs10.27 crore in cash, diamond-studded jewellery, bullion worth Rs23.25 crore, and frozen bank balances, shares, mutual funds, and fixed deposits worth Rs13.86 crore.
The case stems from multiple FIRs filed by the Mira-Bhayandar police commissionerate against builders and officials for unauthorized residential and commercial constructions on government and private land within VVCMC limits since 2009. Investigations revealed that bribes of about Rs150 per square foot were allegedly paid to officials to overlook illegal construction activities.
Notably, 41 unauthorized buildings were raised on land designated for a sewage treatment plant and a dumping ground according to the Vasai-Virar development plan. Builders allegedly misled homebuyers by fabricating approval documents to sell these units despite knowing the buildings were illegal and subject to demolition.
On July 8, 2024, the Bombay High Court ordered the demolition of all 41 buildings, and the Supreme Court dismissed a special leave petition filed by residents. The demolition was completed by VVCMC on February 20, 2025.
The ED alleged that between 2013 and 2021, builders like Sitaram and Arun Gupta illegally alienated about 60 acres of land through forged agreements and sold it to local builders who constructed the unauthorized buildings with the complicity of civic officials. The cartel allegedly included officials like the commissioner, deputy director, junior engineers, architects, chartered accountants, and liaison agents.
Commissioner Anil Pawar is accused of orchestrating the cartel, with a commission for development permissions fixed at Rs20-25 per square foot for him and Rs10 per square foot for YS Reddy. Multiple searches uncovered documentary evidence that the accused floated several entities in family members’ and benamidars’ names to launder illicit proceeds.
The ED’s investigation into money laundering continues alongside criminal proceedings under the original FIRs, with further action expected under the PMLA.
