New Delhi,  The Enforcement Directorate (ED) on Thursday said that they have seized immovable property belonging to G.V. Films Ltd, Chennai, in Tamil Nadu's Thanjavur in connection with a Foreign Exchange Management Act (FEMA) case.

G.V. Films is accused of siphoning off foreign exchange in the guise of issuance of 6.4 million Global Depository Receipts (GDRs) to the tune of Rs 345.6 crore.

"The property seized is a multi-screen theatre complex, namely G.V. Complex at Thanjavur with a value of Rs. 8.94 crore as per the Annual Reports of G.V. Films. However, the market value of the said property appears to be much higher which is being ascertained from the competent authority," an official said.

The official said that the investigation under provisions of the FEMA, revealed that G.V. Films, with an intention to misuse the proceeds of GDRs, opened a bank account in Banco Efisa S.A. (Bank), Lisbon, for the purpose of handling the GDR proceeds.

They had conspired with Whiteview Trading Corporation, a British Virgin Island company, and it entered into a 'Credit Agreement' with the Lisbon bank and availed a loan of $40 million for the purpose of subscribing the GDRs of G.V. Films, the official said.

Then, as a part of conspiracy, G.V. Films Ltd entered into an account charge agreement with the bank, and pledged entire GDR proceeds as collateral against the loan availed by Whiteview. Whiteview Trading Corporation subscribed to the entire 6.4 million GDRs of G.V. Films, which pledged entire $40 million against the loan availed.

By doing so, G.V. Films Limited siphoned off $40 million (equivalent to Rs 172.8 crore) which is supposed to be repatriated to India and utilised the same for the intended purpose as mentioned above.

G.V. Films, as a part of the plan to siphon off foreign exchange, issued 16,00,00,000 equity shares, having the value of Rs 172.8 crore, representing 6.4 million GDRs and the same were sold in the Indian market through the subscriber entities.