The Directorate of Enforcement (ED) has provisionally attached 33,31,000 shares of nova iron & steel , representing a 9.21% stake, held by Aromatic Steel Private Limited. Valued at ₹4,19,37,290 based on the share price as on August 07, 2026, the attachment is part of an ongoing investigation into alleged money laundering linked to the diversion of funds from Bhushan Power & Steel Limited (BPSL). This action follows earlier provisional attachment orders received by the company on June 26, 2026, and July 09, 2026.

The attachment was executed under Provisional Attachment Order No. 21/2026, issued by Mayank Prakash, Deputy Director of the ED’s Delhi Zonal Office-I, on August 07, 2026. The order invokes Section 5(1) of the Prevention of Money Laundering Act (PMLA), 2002, alleging that the shares represent proceeds of crime or value equivalent to such proceeds. The ED notified the Bombay Stock Exchange on August 08, 2026, pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, and SEBI circular No. HO/49/14/14(7)2025-CFD-POD2/I/3762/2026 dated January 30, 2026.

Investigation Background

The ED’s probe centers on an unsecured loan agreement dated July 20, 2011, between BPSL and Nova Iron & Steel Limited (NISL). Under this agreement, BPSL disbursed a total of ₹153,57,19,529 to NISL between FY2011-12 and FY2015-16 for the installation of a 12 MW Waste Heat Recovery Based Power Plant and induction furnace. The ED alleges that these funds were diverted from bank loans sanctioned to BPSL by a consortium of 33 banks, led by Punjab National Bank, and subsequently misappropriated by the erstwhile promoters of BPSL.

According to the ED’s findings, NISL repaid only ₹27,85,15,681 towards principal and paid ₹92,33,35,238 in interest. Consequently, a sum of ₹201,20,89,467 remains pending. The ED contends that this outstanding amount constitutes proceeds of crime, as it originated from fraudulently diverted bank funds involving criminal conspiracy, cheating, and forgery by BPSL’s former management.

Shareholding and Beneficial Ownership

Aromatic Steel Private Limited holds 67,49,000 shares (18.67%) of Nova Iron & Steel Limited. Of this holding, 34,18,000 shares (9.46%) were previously attached under PAO No. 15/2026 dated June 25, 2026. The current order attaches the remaining 33,31,000 shares (9.21%).

The ED asserts that Aromatic Steel Private Limited is beneficially owned and controlled by Sanjay Singal, the erstwhile promoter of BPSL. This conclusion is drawn from bank records showing Singal as an authorized signatory and beneficial owner of Aromatic Steel’s accounts, as well as statements from former BPSL executives. The ED further notes that Sanjay Singal admitted in his statement dated November 17, 2025, that he controls Aromatic Steel Private Limited and other group entities.

Company Response

Nova Iron & Steel Limited stated that it is examining the contents of the order and will take appropriate legal steps to safeguard its interests. The company maintains that the provisional attachment order does not have a material impact on its day-to-day operations. Dheeraj Kumar, Company Secretary, signed the disclosure filed with the exchange.

Promoter group entities Olympian Finvest Private Limited and Aromatic Steel Private Limited have acquired a combined 7,90,4675 equity shares of nova iron & steel from fellow promoter group members, consolidating their stake through an off-market restructuring. The transactions, disclosed on July 23, 2026, were executed at a price of ₹11 per share and exempted from open offer obligations under Regulation 10(1)(a)(iv) of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011. This internal realignment ensures the promoter group maintains its aggregate shareholding of 44.16%, with no change in total promoter ownership or voting rights.

The acquisition was structured to comply with regulatory mandates, including prior intimation to stock exchanges under Regulation 10(5) on June 20, 2026, and post-acquisition reporting under Regulation 10(6) on July 6 and July 9, 2026. Both acquirers paid a fee of ₹1,50,000 plus 18% GST (totaling ₹1,77,000) to the Securities and Exchange Board of India (SEBI) for the exemption. The acquisition price was confirmed to be within 25% of the fair value calculated under Regulation 8(2)(e), which stood at ₹10.40 per share for this infrequently traded stock.

Transaction Details

The restructuring involved two distinct blocks of shares transferred between promoter group entities:

Olympian Finvest increased its holding from 94,000 shares (0.26%) to 46,67,675 shares (12.92%). Simultaneously, Aromatic Steel raised its stake from 34,18,000 shares (9.46%) to 67,49,000 shares (18.67%). The sellers, including Reward Capital Services and Nilanchal Investments, exited their positions in Nova Iron & Steel entirely as part of this group-wide consolidation.

Regulatory Compliance and Disclosures

All parties adhered to Chapter V disclosure requirements. Changes in shareholding and voting rights were reported under Regulation 29(2) on July 1, 2026, for Olympian Finvest and Reward Capital Services, and on July 17, 2026, for Aromatic Steel and Nilanchal Investments. The company’s Company Secretary, Dheeraj Kumar, submitted the final disclosure to the Bombay Stock Exchange on July 24, 2026. The promoter group’s total shareholding remains unchanged at 1,59,59,675 shares (44.16%), while public shareholding stands at 55.84%.