Raipur, September 3: The Enforcement Directorate (ED) has arrested Satpal Singh Chhabra in connection with the District Mineral Foundation (DMF) scam in Chhattisgarh under the provisions of the Prevention of Money Laundering Act (PMLA), 2002. Chhabra was apprehended on Tuesday and presented before the special PMLA court in Raipur, which remanded him to five days of ED custody.
According to the ED, the investigation is based on several FIRs filed by the Raipur-based Anti-Corruption Bureau (ACB)/Economic Offences Wing (EOW) regarding the misuse of DMF funds. These trusts, established in each district for the benefit of communities affected by mining activities, have allegedly been exploited by a network of public servants, intermediaries, and vendors.
Between the fiscal years 2019-20 and 2023-24, districts received approximately ₹9,188.20 crores under the DMF scheme. However, the ED stated that a portion of these funds was embezzled by prioritizing supply-oriented activities, leading to arbitrary pricing and commission earnings. A significant amount of the funds was routed through the Chhattisgarh State Seed and Agricultural Development Corporation (Seed Corporation), where agents and intermediaries reportedly charged commissions ranging from 25% to 50% based on the base price of purchase orders issued to contractor entities.
These commissions were then distributed among government employees and influential individuals to facilitate the issuance of work orders and the release of payments. Chhabra is accused of playing a central role as an intermediary and financial coordinator, identifying profitable supply-based DMFT activities, allocating them among selected vendors, facilitating the issuance of work orders, ensuring payment releases, and collecting commissions for distribution within the syndicate.
According to an ED press release, incriminating documents related to the scam were recovered during a search conducted in September 2025 under Section 17(1) of the PMLA. Further analysis of banking transactions and details recorded under Sections 17 and 50 of the PMLA revealed that Chhabra had received approximately ₹31 crores in illegal commissions. This amount, classified as proceeds of crime, was found in the accounts of his family members, Hindu Undivided Families (HUF), and entities controlled by him. Consequently, he was arrested under Section 19 of the PMLA, 2002.
The ED has stated that further investigations into the DMF scam are ongoing.
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