NHAI–SIPCOT Land Acquisition Scam: ED Seizes Rs18.10 Crore in Chennai Raids

Moneylife Digital Team 21 November 2025

Economy & Nation

The Chennai zonal office of the directorate of enforcement (ED) conducted search operations on 19 November 2025 at 15 locations across Chennai, Kancheepuram and Chengalpattu in connection with a major land fraud involving forged documents and wrongful compensation claims linked to acquisitions by the National Highways Authority of India (NHAI) and the State Industries Promotion Corporation of Tamil Nadu (SIPCOT). The searches resulted in the seizure of cash totalling Rs1.56 crore and bullion worth Rs74 lakh. The agency also froze bank balances amounting to Rs8.4 crore and shares valued at Rs7.4 crore, bringing the total value of seized and frozen assets to Rs18.10 crore.

The searches were initiated following investigations based on first information reports (FIRs) registered at Sriperumbudur police station and Kancheepuram police in 2021 and 2022, which alleged offences of forgery, cheating, criminal conspiracy and fraudulent receipt of compensation.

According to the FIRs, land originally provided in 1991 by entities of the VGP group for public utilities such as roads and parks was later reclaimed through forged and fabricated documents by one VGS Rajesh and subsequently sold to private persons shortly before acquisition proceedings by NHAI and SIPCOT.

The Madras High Court, in matters connected to these transactions, had earlier observed that several individuals had fraudulently claimed ownership of such lands, causing significant losses to the public exchequer.

ED investigations revealed that forged, fake and bogus documents were used to cancel deeds registered in favour of public authorities just before the land acquisitions commenced. These cancellations enabled the resale of public utility land, and in many cases, the properties were sold to associates of the key conspirators, who then declared artificially inflated purchase values in registration records.

These inflated figures were subsequently used to secure higher compensation during acquisitions carried out by NHAI for the Bangalore–Chennai Expressway and by SIPCOT for industrial expansion projects.

The agency says the entire operation was executed through a well-structured modus operandi devised by key individuals with the support of associated public servants. This included the unlawful cancellation of deeds, resale of public lands through controlled or dummy buyers, artificial enhancement of market value, extraction of inflated compensation and layering of the proceeds across the bank accounts of associates, relatives and shell entities. In several instances, large cash withdrawals amounting to several crores were made after the proceeds were layered to conceal their illicit origins.

During the raids, ED officials recovered various incriminating documents and digital evidence relating to forged land records, inflated valuations, layering of compensation amounts and communication among the conspirators. These findings corroborate earlier analyses of voluminous bank statements and testimonies from individuals linked to the network.

ED says further investigation is underway to trace the full money trail, identify additional beneficiaries and quantify the total loss to the exchequer arising from the land compensation fraud that has disrupted major public infrastructure projects involving NHAI and SIPCOT.

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