Raipur, Sep 2: The Enforcement Directorate (ED) on Tuesday arrested Satpal Singh Chabda under the Prevention of Money Laundering Act (PMLA), 2002, in connection with its probe into alleged misuse of District Mineral Foundation (DMF) funds in Chhattisgarh.
ED custody and legal proceedings
Chabda was produced before the Special Court, PMLA, Raipur, which granted the ED five days' custody to continue its investigation, an ED statement said. The agency said the probe has its origins in multiple FIRs lodged by the Anti-Corruption Bureau/Economic Offences Wing (ACB/EOW), Raipur, and state police over alleged misappropriation of DMF monies.
Allegations and modus operandi
DMF trusts were constituted in each mining-affected district to finance projects for communities impacted by mining operations. The ED has alleged that a syndicate comprising public servants, liaisoners and vendors diverted a portion of these allocations by prioritising supply-oriented works that allowed inflated pricing and the generation of commissions.
- Districts reportedly received approximately ₹9,188.20 crore under DMFT between FY 2019-20 and 2023-24.
- Large sums were allegedly routed through the Chhattisgarh Rajya Beej Evam Krishi Vikas Nigam (Beej Nigam), the ED said.
- Agents and liaisoners are accused of charging commissions of 25–50% on the base value of purchase orders issued to rate contract holders.
The ED described Chabda as a key liaisoner and financial coordinator in the alleged scheme. According to the agency, he identified lucrative supply-based DMFT works, apportioned them among selected vendors, facilitated issuance of work orders and ensured release of payments, in the process collecting commissions to be shared within the syndicate.
Evidence recovered and financial tracing
Searches carried out by the ED in September 2025, under Section 17(1) of the PMLA, reportedly turned up documents the agency described as incriminating and relevant to the scam. Subsequent analysis of banking transactions and account statements obtained under Sections 17 and 50 of the PMLA indicated that Chabda received commissions totalling about ₹31 crore, which the ED has classified as proceeds of crime.
| Item | Alleged amount |
|---|---|
| Total DMFT disbursed (FY 2019-20 to 2023-24) | ₹9,188.20 crore |
| Commissions allegedly received by Chabda | ~₹31 crore |
Scope and implications
The ED said the alleged diversion occurred across multiple districts and involved a supply-driven procurement model that permitted price inflation and commission extraction. The agency is treating the sums recovered in identified accounts as proceeds of crime and is continuing financial investigations to trace the ultimate beneficiaries and further layers of the channeling of funds.
Probes by the ACB/EOW and state police FIRs provided the initial basis for the ED's money-laundering investigation. The matter implicates officials and intermediaries in a programme intended to benefit mining-affected communities, raising concerns about the effective delivery of DMF projects on the ground.
What the ED is pursuing next
The ED has custody of the accused for interrogation and said it will continue to scrutinise bank records, property transactions and other material to establish the money trail. The agency's actions may include attachment of assets and further arrests if additional evidence emerges linking others to the alleged syndicate.
Investigations under the PMLA are distinct from any criminal prosecutions under state anti-corruption statutes; the ED's role focuses on identifying, tracing and confiscating proceeds of crime.
As the inquiry develops, the court will determine the period of judicial custody or further remand sought by the ED. No chargesheet under PMLA has been mentioned in the ED communication to date.
State authorities and the ACB/EOW had earlier registered multiple FIRs that now form part of parallel probes being referenced by the federal agency. The ED's statement did not list any other individuals by name in connection with Tuesday's arrest beyond identifying Chabda's alleged role in the syndicate.
