Most contracts went to ineligible vendors: ED

The Enforcement Directorate's probe into Mumbai's BMC pandemic-related contracts found that most went to ineligible suppliers or were priced higher. The agency is examining the role of five middlemen and their links to certain BMC officials, investigating three firms of a suspect's brother to determine if any quid pro quo transactions were routed to their accounts. The ED is also investigating payments allegedly made to civic officials by suppliers and middlemen in coded diary entries. The case began with an FIR against the partners of Lifeline Hospital Management Services, which bagged a ?38-crore bid to set up two jumbo Covid centres.

MUMBAI: The Enforcement Directorate (ED)’s preliminary probe into the BMC’s ₹4,000-crore expenditure on pandemic-related contracts has revealed that a majority of the contracts went to ineligible suppliers or were pegged at much higher rates.

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“As a pandemic was on then, bonafide actions and decisions are not under the scanner,” said an ED official. “However, cases where there were irregularities or favours, with accompanying quid pro quo transactions, are.”

ED sources said that civic officials had earlier told the agency that the BMC had no mechanism at that time to verify the documents submitted by firms along with their bids for contracts. The agency is likely to refer a few cases to the Mumbai police for further investigation.

The agency is examining the role of five middlemen who allegedly liaised between Covid suppliers and certain BMC officials. “We are probing the quid pro quo angle in such cases to ascertain the beneficiaries,” the ED official said.

The agency has sealed the flat of one such person, and is verifying his antecedents, including the source of funding of four flats in the name of another person who is also a suspect. The agency is also investigating three firms of a suspect’s brother to determine if any quid pro quo transactions were routed to their accounts.

ED sources said that their searches had also yielded a “diary” that contained entries, suggesting payments made to civic officials by suppliers / middlemen. The entries in the diary are coded, and the agency is trying to crack them to begin probing alleged irregularities in those transactions.

The ED case began with an FIR registered in August 2022 against the partners of Lifeline Hospital Management Services, which bagged a ₹38-crore bid to set up two jumbo Covid centres at Dahisar and Worli. According to the FIR, the company submitted forged documents to the BMC, and had neither adequate staff nor experience in providing manpower at a medical facility. It was also alleged that the firm was unregistered.

Lifeline was blacklisted by the Pune Metropolitan Region Development Authority after a journalist died of Covid-19 at its jumbo centre. However, the BMC awarded the same company a contract worth ₹38 crore, of which a payment of ₹30 crore had been made, the FIR said. The ED probe has established that of this ₹30 crore, around ₹22 crore got diverted. The ED is also verifying various other allegations vis-à-vis the jumbo centres.