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The Central Bureau of Investigation (CBI) has sought sanction from the Uttar Pradesh (UP) government to investigate three senior Indian Administrative Service (IAS) officers, including the current Union Agriculture Secretary Sanjay Aggarwal and Union Power Secretary Alok Kumar, in connection with its probe into the alleged Rs 2,267-crore Employees’ Provident Fund ‘scam’ in the state.
The third IAS officer sought to be probed by the agency is Aparna U, the current chairman of the UP Power Corporation Ltd (UPPCL), where the scam allegedly took place between March 2017 and December 2018.
Aggarwal was additional secretary and UPPCL chairman during the scam period and was succeeded by Alok Kumar, who was in turn succeeded by Aparna U.
“The sanction to investigate these officers was sought in December last year from the state government as per law,” an official privy to the development said.
The CBI registered a case in the matter on recommendation from the state government in March 2020. The case, which is about savings of power sector employees being invested in the beleaguered Dewan Housing Finance Corporation (DHFL), had been first registered by UP police.
Pravin Kumar Gupta, former secretary of the UP State Power Sector Employees’ Trust; and Sudhanshu Dwivedi, former director, finance, Uttar Pradesh Power Corporation Limited (UPPCL); had been named as accused for criminal breach of trust, cheating and forgery. Both were arrested by the Hazratganj police in November 2019.
The DHFL came in the eye of the storm after a report suggested that the company, through a maze of shell companies, allegedly siphoned off Rs 31,000 crore out of total bank loans of Rs 97,000 crore.
Provident funds of the UPPCL employees were being invested in the fixed deposits of nationalised banks till October 2016. On a proposal of Gupta and former UPPCL managing director A P Mishra, the investment of funds started in PNB Housing in December 2016, according to the officials.
From March 2017 to December 2018, Gupta, after getting endorsement from Dwivedi, violated central government guidelines – that such funds would not be invested in financial institutions other than scheduled commercial banks – and invested over 50 per cent of funds in the DHFL, the FIR stated.
It said the investments were in deposit schemes of the DHFL despite knowing it was not a scheduled commercial bank and an “unsafe” company. A total of Rs 4,122.70 crore was invested in the DHFL, out of which Rs 2,267.90 crore are still outstanding, officials said.
Aggarwal, a 1984-batch IAS officer of the UP cadre, was UPPCL chairman from 2013 till May 2017. Investigations have found that Aggarwal was part of the decision to invest employees’ funds into the DHFL. The first transfer of Rs 18 crore was made to the DHFL on March 17, 2018 when Aggarwal was the UPPCL chairman.
The first FIR in the matter had been registered on November 2, 2019, by the power employees’ trust secretary I M Kaushal at the Hazratganj police station. On the same day, the state government had sent a recommendation to the Centre for a CBI probe into the matter.
The case was filed under IPC Sections 420 (Cheating and dishonestly inducing delivery of property), 468 (Forgery for purpose of cheating) and 409 (Criminal breach of trust by public servant, or by banker, merchant or agent), among others.
Since the CBI had then not taken up the investigation, the state government directed the Economic Offences Wing (EOW) to investigate the matter. During the investigation, the EOW arrested 17 persons, including the owner of brokerage firms, a chartered accountant and also former employees of the DHFL. The EOW also arrested then managing director of UPPCL A P Mishra.
On January 31, 2020, the EOW filed chargesheet against Praveen Kumar, Sudhanshu and AP Mishra – all three are lodged in jail – under the same section in which the FIR was lodged.
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