MP depts contradict each other, row in court

In a point-by-point rebuttal to the affidavit, accessed by The Indian Express, the Bureau has said, ‘‘The affidavit filed without the investigating agency’s knowledge gives rise to a suspicion. In such a serious case involving public money worth crores, it was surprising that the GAD gave a clean chit to a person against whom the bureau has evidence.’’

In support, the bureau has enclosed a six-page confidential note citing transactions between Madhya Pradesh State Industrial Development Corporation (MPSIDC), when Mohanty was its MD, and three units involving a sum of Rs 48.40 crore loans (ICDs).

Since the affidavit was related to Mohanty, the bureau has cited only those instances that involved him. Quoting from written communications, the note details how an Indore-based sick company was given additional loan when it already owed the MPSIDC Rs 28.45 crore. Not only had the company defaulted on earlier payments, the CBI had filed a case against it in Mumbai. Mohanty also knew that the company’s case had been referred to BIFR and yet Rs 40 lakh were given to a sister concern.

A Hyderabad-based software company was sanctioned Rs 3 crore working capital when it had no operations in MP, without verifying its financial status. The note also repeatedly mentions a general manager (who is no more) who reported to Mohanty and was involved in all the dealings.

The bureau said all the dealings were essentially illegal because the MPSIDC board had not approved them. Mohanty made no effort to secure the loans and there was no financial due diligence before the loans were issued.

Mohanty’s alleged help to companies by misusing his official position was not in public interest, the Bureau said, justifying why it had also lodged a case under Prevention of Corruption Act against him besides relevant sections of IPC (misappropriation, cheating, forgery and conspiracy) against all the accused that included bureaucrats and beneficiary units. While the Bureau’s investigation had reached a final stage, Mohanty, who was seeking a deputation to the Centre, had moved the High Court seeking quashing of the FIR. The GAD filed an affidavit giving a clean chit to Mohanty without the knowledge of the chief minister and the investigating agency.

The affidavit claimed that the Bureau had never been asked to file an FIR but merely submit a preliminary report, and that the report was never submitted to GAD despite repeated reminders. The Bureau has quoted dates and details of correspondence it had with GAD to counter the claims.

The Bureau said the investigations took more time because the scope of the scam was wide and it involved many companies, some based outside MP. A senior officer of the Bureau admitted that the affidavit had almost undone the investigation when, ironically, the government was about to sanction its proposal to hire a private chartered accountancy firm for its final opinion in the matter.

Mohanty is now secretary, Women and Child Welfare Department. The government has announced that it will move the Supreme Court against the High Court order.