Daijiworld Media Network - Bhopal
Bhopal, Mar 16: The Enforcement Directorate’s (ED) Bhopal Zonal Office has arrested Kishan Modi, a principal associate of M/s Jayshri Gayatri Food Products Pvt Ltd, in a major money laundering case involving adulterated dairy exports.
Modi was taken into custody on March 13, 2026, under Section 19(1) of the Prevention of Money Laundering Act (PMLA), 2002, and produced before the Special PMLA Court in Bhopal the next day. The court granted ED custody until March 18, 2026, for detailed interrogation.
The probe is based on two predicate offences — one registered on August 29, 2023, at Habibganj Police Station, and another on July 22, 2024, by the Economic Offences Wing — targeting the company’s directors and officials under multiple sections of the Indian Penal Code.
Investigations revealed that the company, which marketed dairy products under the Milk Magic brand, systematically substituted milk fat with palm oil and other harmful chemicals, producing adulterated goods. These products were sold domestically and exported abroad.
To obtain export clearances, the firm allegedly submitted forged laboratory test reports to the Export Inspection Agency in Indore.
Cross-verification by the ED showed that many reports were fabricated and never issued by the listed laboratories. Using these fake certificates, the company exported the contaminated products and funneled proceeds into accounts at Axis Bank and HDFC Bank, amounting to approximately Rs 20.59 crore identified as proceeds of crime.
The ED said the operation involved deliberate deception of regulatory authorities and foreign buyers, posing serious public health risks both in India and internationally.
Modi’s arrest marks a key step in the ongoing investigation, which continues to examine the roles of other directors and the complete financial network. Officials indicated that further arrests and asset attachments are likely as the probe unfolds.
This case has again raised concerns over food safety standards and the potential misuse of export mechanisms for illicit gains in the dairy industry.