E-Paper
ED searches 11 premises of contractors, suppliers
The Enforcement Directorate (ED) searched 11 locations in Mumbai in connection with the alleged ?600 crore Covid-related scam involving the Brihanmumbai Municipal Corporation (BMC). The ED is investigating whether profits from inflated contracts were shared with BMC officials and others with political influence. The agency has seized cash and is probing irregularities in the contracts. Contractors associated with construction firms are suspected of overcharging the BMC for oxygen plants and other supplies for Covid centres. The ED is also investigating a contractor for supplying body bags at inflated rates.
BMC Covid centres scam
Mumbai: The Enforcement Directorate (ED) recently searched 11 locations in the city which belong to the suppliers and contractors involved in the alleged Brihanmumbai Municipal Corporation’s (BMC) Covid-related scam worth around ₹600 crore. Many of the contracts are allegedly awarded at highly inflated rates.
“We are verifying if a substantial percentage of the profits earned in certain inflated Covid contracts were shared with BMC officials, middlemen and others claiming to have political influence,” an ED source said.
The agency’s searches were carried out as part of its money- laundering investigation related to BMC’s ₹4,000-crore expenditure on pandemic-related contracts.
“A lot of irregularities were noticed during the searches on Wednesday and they are being probed further to reach the end-beneficiaries of the proceeds from the profits gained in inflated contracts,” the source said.
The agency on Wednesday had seized ₹1.2-crore cash from the premises of a civic contractor associated with a construction firm. It also recovered ₹60 lakh from the premises of another contractor, Romell Realtors.
“While the agency’s officials had interrogated all the contractors during the search operations, it will record their statements at its office once they are summoned for questioning during the next two weeks,” sources said.
One of the contractors under the scanner, associated with the construction firm, had taken a contract of setting up oxygen plants at Jumbo Covid centres and had allegedly charged the BMC ₹60 crore more than what it had incurred as costs, ED sources added. “The contractor procured the oxygen from another Delhi-based supplier for ₹20 crore but the BMC had to pay ₹80 crore for the same. We are verifying how and why he charged in excess and where the profits went,” the ED source said.
“The same contractor had also charged the BMC ₹60 crore in another similar contract, though it is suspected that he may have spent only ₹12 crore,” the source said.
Romell Realtors on the other hand, had taken up the contract of assisting in the setting up of a 2,000-bed Jumbo Covid centre in Goregaon in June 2020. The firm told the ED that its contract was worth around ₹11.36 crore, plus taxes, and that they had supplied materials including air-conditioner units, fans and chairs.
“The firm has denied any wrongdoing and claimed that after implementing its contract, they donated the remaining articles worth ₹2 crore, as a CSR measure to the BMC. The details of the contract are being verified,” the source said.
Another contractor under the scanner, which is an events management firm, had supplied beds, among other articles, for Covid centres. The agency is verifying if it was paid around ₹88 crore for supply to two such covid centres, the sources said.
The firm had earlier worked on a similar project before it bagged the civic contract, the ED source said, adding, “We are verifying if there were any irregularities in the contract. The agency could not check the content of the contractor ‘s phone as he claimed to have lost it in a cab recently.”
An Aurangabad - based contractor is also under the ED scanner for allegedly supplying body bags at inflated rates.
Last month, the ED had conducted searches at 15 premises in the case, including those of businessman Sujit Patkar, party functionary Suraj Chavan and BMC’s then additional municipal commissioner Sanjeev Jaiswal.
