NEW DELHI: Digging out another UPA-era scam, the CBI on Wednesday registered a case against former union minister for textiles Shankersinh Vaghela, former CMD of National Textiles Corporation K Ramachandran Pillai and private company Hall & Anderson Ltd and its director Kamlesh Mehta in the alleged sale of prime land belonging to Shree Madhusudan Mills in Mumbai at “throwaway prices”.
The agency raided the senior Congress leader and former Gujarat chief minister’s residence in Gandhinagar and recovered Rs 13.33 lakh cash and now plans to interrogate him.
CBI booked Vaghela, Pillai, Mehta and two other officials of NTC – R K Sharma and N K Khare – for criminal conspiracy, cheating and sections of Prevention of Corruption Act. The sale of government-owned land to the private company at a price of Rs 29.35 crores led to a loss of Rs 709.27 crore to the government exchequer, as the market value of the prime pre-independence era property in Mumbai’s Worli area was much higher.
The scandal was first exclusively reported by ToI in May last year when CBI began a Preliminary Enquiry into the sale of Madhusudan Mills. Sources said that more such sales of mills owned by state-run NTC are under CBI scanner.
“M/s Madhusudan Mills was taken over by the ministry of textiles/NTC and nationalized under the Textiles Undertakings (Taking Over of Management) Act 1983 and the Textiles Undertaking (Nationalisation) Act, 1995. All the assets of the said firm (Madhusudan) were transferred to the central government/NTC and suitable amount was paid to M/s Madhusudan,” CBI says about the government taking over the Madhusudan Mills, which was listed among sick companies and was not operational.
CBI officials said Kamlesh Mehta of Hall & Anderson was allowed to develop 27,500 square meters of the 80,785 sqm area of Madhusudan Mill as part of revival of mills of NTC. The land was handed over at a price of Rs 29.35 crore to the Kolkata-based company and its owner for redeveloping it in a move to reach a settlement in July, 2009.
“It is alleged that in the process of settling of issues regarding taking over of assets and liabilities of the Madhusudan Mills, Vaghela overruled the opinion of the senior officers of the textiles ministry seeking a comprehensive proposal from NTC, owning the land, including the actual valuation of the land for settlement of the issues,” says CBI FIR. “Vaghela overruled this view of ministry officials due to which valuation of property was not done,” said a CBI official.
CBI says Vaghela abused his official position to approve the sharing of the land in the ratio of 65:35 in favour of Mehta and his company.
“The accused persons entered into a criminal conspiracy in reaching a settlement by giving away 35% of premium portion of land of Madhusudan Mills on the ground that it would help NTC convert properties from leasehold to freehold,” a senior CBI officer said.
After registering the case on Wednesday, CBI teams carried out raids at nine places including Vaghela’s residence in Gandhinagar from where they recovered Rs 13.33 lakh, Pillai’s residence in New Delhi from where sleuths recovered fixed deposit papers worth Rs 1.65 crore and a locker’s papers and other incriminating documents from residences of other named accused and the office of Hall & Anderson. The places raided included Mumbai, Gandhinagar, Delhi and Kolkata.
CBI is probing Pillai in another NTC land sale as well. The former CMD of NTC had allegedly favoured a private company New Jack Printing Press Private Ltd by transferring ownership rights of a plot owned by NTC in Parel, Mumbai. The plot measuring 4,080 square meters, was leased out to New Jack Printing Press but it was not allegedly paying the rent which had accumulated to over Rs 90 crore. The NTC agreed to sell the land at Rs 17.5 crore in 2007 to the same company.