Over-invoicing case: No progress, so closed probe against Adani firm, others in 2015, CBI to Delhi HChttps://indianexpress.com/article/business/companies/over-invoicing-case-no-progress-so-closed-probe-against-adani-firm-others-in-2015-cbi-to-delhi-hc-5159180/

Over-invoicing case: No progress, so closed probe against Adani firm, others in 2015, CBI to Delhi HC

In an affidavit before a bench of Justices S Ravindra Bhat and A K Chawla, the CBI said “not much progress could be made in the enquiry and the PE was closed on 15.07.2015 on jurisdictional issue” since the project was under the Maharashtra government.

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The CBI was responding to a notice issued to the agency on April 4.

The CBI informed the Delhi High Court Tuesday that its preliminary enquiry (PE) against Adani Enterprises Ltd, Maharashtra Eastern Grid Power Transmission Company Ltd (MEGPTCL) and others including public sector banks over allegations of over-invoicing of import of raw material and equipment relating to power projects in India was closed in July 2015 because its probe could not make much headway.

In an affidavit before a bench of Justices S Ravindra Bhat and A K Chawla, the CBI said “not much progress could be made in the enquiry and the PE was closed on 15.07.2015 on jurisdictional issue” since the project was under the Maharashtra government.

“…on the basis of Source Information Report, Preliminary Enquiry… was registered on 12.06.2014… against M/s Maharashtra Eastern Grid Power Transmission Company Ltd (MEGPTCL), M/s PMC Projects India Pvt Ltd, M/s Adani Enterprises Ltd (AEL), M/s Maharashtra State Electricity Transmission Co Ltd (MSETCL) and unknown officials of Public Sector Banks (SBI, PNB, Vijaya Bank, OBC, SBM & Canara Bank),” the CBI stated in its affidavit.

This, the agency said, was done to “enquire into the allegations of availing various credit facilities for the purpose of procurement of power generation and power transmission equipment/machineries from various vendors of South Korea, China etc, through a UAE-based intermediary M/s Electrogen Infra FZE, Dubai (an Adani Group company), which were allegedly imported by gross over-valuation/over-invoicing, thereby siphoning the funds of various Public Sector Banks (PSBs)”.

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“Another allegation was added during enquiry to look into the effect of exaggeration of project cost on fixation of tariff and also to avail excess finance from the bank to fulfil the requirement of margin money without infusion of own capital,” the affidavit stated.

“…the crore issue of the said PE was pertaining to the transmission network which was within the Maharashtra State i.e. Intra-State Transmission System. Thus, it was a project under the Government of Maharashtra. That, for the reason mentioned above, not much progress could be made in the enquiry and the PE was closed on 15.07.2015 on jurisdictional issue,” it said.

The CBI was responding to a notice issued to the agency on April 4, seeking its stand on pleas seeking a court-monitored probe into alleged over-invoicing of import of raw material and equipment relating to power projects in India by electricity generating companies including the Adani Group.

The High Court had asked CBI to inform it about the PE conducted against one of the firms based on show-cause notices by the Directorate of Revenue Intelligence (DRI). The matter has now been fixed for further hearing on July 14.

The petitions were filed by NGOs, Centre for Public Interest Litigation and Common Cause, and former bureaucrat and social activist Harsh Mander. They have sought a court-appointed SIT probe.

On Tuesday, advocates Prashant Bhushan and Pranav Sachdeva, appearing for the two NGOs, alleged that over-pricing was a cause for the rising number of non-performing assets (NPAs) of banks.