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Central agency to probe firm linked to Kerala CM’s daughter
A federal investigating agency under the ministry of corporate affairs, SFIO is mandated to probe serious corporate fraud cases
The Union government has handed over the probe into alleged irregularities in financial transactions of a firm owned by Veena T, daughter of Kerala chief minister Pinarayi Vijayan, to the Serious Fraud Investigation Office (SFIO) and asked it to submit a report within eight months.
“The Central government has ordered investigation under Section 212 (1)(a) and (c) of the Companies Act, 2013 into the affairs of Exalogic Solutions Private Limited, Cochin Minerals and Rutile Limited (CMRL) and Kerala State Industrial Development Corporation (KSIDC) and has assigned the same to Serious Fraud Investigation Office (SFIO),” the order issued by the Union corporate affairs ministryon Wednesday read.
A federal investigating agency under the ministry of corporate affairs, SFIO is mandated to probe serious corporate fraud cases.
The Centre also announced a six-member probe team, with deputy director M Arun Prasad as the investigating officer and also comprising Prasad Adelli, K Prabhu, A Gokulnath, KMS Narayan and Varun BS.
“The Inspectors and the Investigating Officer shall complete the investigation and submit their report within eight months to the Central government,” the order said.
While Exalogic is the Bengaluru-based firm owned by Veena, CMRL is a Kochi-based private minerals manufacturer and KSIDC is a state-run firm which has a stake in CMRL.
A massive row broke out in July last year after it was found that CMRL had made monthly payments to the tune of ₹1.72 crore to Veena and her firm Exalogic over three years despite no services being rendered by the latter.
Veena and her firm had signed an agreement with CMRL in 2017 for giving information technology (IT), marketing consultancy and software services. In January 2019, the Income Tax department had conducted searches and raids at the offices of CMRL and residences of its managing director (MD) and other key officials, and found there was tax evasion by exaggerating the expenses of the firm.
The opposition UDF in Kerala has alleged that the suspicious financial transactions are evidence of corruption and bribery as Veena is connected to an important political figure in the state. Both Vijayan and his party, the Communist Party of India (Marxist) have termed the allegations baseless.
On January 24, the Centre had told the Kerala high court that there were no restrictions on initiating a probe by the SFIO into the affairs of the three firms in response to a petition filed by Shone George, who along with the father PC George, a former legislator, joined the Bharatiya Janata Party (BJP) on Wednesday.
The Registrar of Companies in Bengaluru had recommended an investigation into Exalogic to the Union corporate affairs ministry after it found several violations of the Companies Act, 2013 in its inquiry. Subsequently, the ministry on January 12 ordered a probe by a three-member panel.
Reacting to the development, CPI(M) central committee member AK Balan said, “This is a conspiracy hatched to insult and defame a person and his family. We know there are some forces behind this conspiracy. It will be clear before the public who these forces are.”
Senior BJP leader and Union minister V Muraleedharan said: “The CM and his daughter must co-operate with the investigation. The CM said yesterday [on Wednesday] that his hands were clean inside the assembly. Even party workers of his home district Kannur will not believe what he says.”
