Mumbai: The Enforcement Directorate (ED) on Wednesday arrested former Vasai-Virar City Municipal Corporation (VVCMC) commissioner Anil Pawar, suspended deputy director of town planning Y S Reddy, builder Sitaram Gupta and his nephew Arun Gupta in connection with an alleged money laundering case linked to the illegal construction of 41 buildings on 60 acres of government and private land reserved for public utilities.
The accused are scheduled to be produced before the PMLA Court in Mumbai on Thursday.
Sources said the arrests came after all four were summoned to the ED’s office at CJ House Complex, Worli, for a joint interrogation. Over the past few months, the agency had recorded their statements, conducted searches, and compiled a detailed timeline of their alleged roles. Officials said the questioning on Wednesday helped establish their involvement, following which they were taken into custody late in the evening under the Prevention of Money Laundering Act (PMLA).
The case stems from allegations that civic and town planning officials colluded with private developers as part of a powerful syndicate operating within the municipal body. According to the ED, the network included senior municipal officers, political figures, and rogue builders who allegedly conspired to convert land meant for public use into private real estate. The agency has termed it a “deep-rooted nexus” that turned public land into a “private goldmine”.
Investigators alleged that former commissioner Anil Pawar played a crucial role in the cartel’s operations Findings under PMLA indicate that after Pawar took charge of the VVCMC a commission described by officials as a bribe was allegedly fixed at Rs 20 to Rs 25 per sq ft for the commissioner for the project construction and Rs 10 per sq ft for then deputy director of town planning Y S Reddy calculated on the total project area.According to ED investigation.
During searches, the ED claims to have seized a large number of incriminating documents showing that Pawar created multiple entities in the names of his family members, relatives, and benamidars to launder the bribe amounts. These shell companies, the agency alleges, were formed during his tenure and were engaged in the construction and redevelopment of residential towers and the building of warehouses.
Arrested accused Y.S. Reddy,currently suspended from the VVCMC, allegedly issued bogus commencement certificates by misusing Building Permit (BP) numbers, even for plots reserved for public amenities. Construction reportedly proceeded with approvals for ground-plus-one structures, which were later extended illegally by manipulating permissions.
In May this year, the ED seized Rs 8.6 crore in unaccounted cash and diamond-studded jewellery and bullion worth Rs 23.2 crore from Reddy’s premises in Hyderabad’s Hafeezpet. Investigators also noted that Reddy had once headed a Special Investigation Team (SIT) formed to probe a multi-crore fake CC/OC scam.
Reddy, was previously arrested by the Thane unit of the Anti-Corruption Bureau (ACB) in 2016 connection with the same illegal construction racket
The ED alleged that Pawar and Reddy were part of an organised cartel within the civic body, colluding with engineers, town planners, architects, chartered accountants, and liaison agents to approve unauthorised buildings in return for bribes.
Former Bahujan Vikas Aghadi (BVA) corporator Sitaram Gupta and his nephew Arun Gupta, who were arrested by the ED, allegedly prepared bogus completion certificates for the buildings, issued in the names of CIDCO and the Vasai-Virar City Municipal Corporation (VVCMC). Their accomplices are said to have acquired 30 acres of private land and an additional 30 acres reserved for water purification plants and dumping grounds, and sold it to various builders after acquiring fake ownership documents.
Officials said the ED has been investigating the case for several months, recording statements and conducting searches at different stages. After compiling a detailed timeline and analysing interrogation findings, the agency arrested all four accused late Wednesday under the PMLA.
