Between 2007 and 2011, companies associated with the family of former Uttar Pradesh chief minister Mayawati, including those of her brother, Anand Kumar, and his wife, Vichiter Lata, have built a huge cash chest.
From almost zilch, a set of 20 companies had cash and bank balances of about Rs 1,200 crore, according to Mumbai-based Bharatiya Janata Party (BJP) leader and investment activist Kirit Somaiya’s complaint filed with various investigation agencies, including the enforcement directorate and the Central Bureau of Investigation (CBI).
Office bearers of the Bahujan Samaj Party (BSP) refused to comment on the issue. After media reports gave a fresh life to these year-old allegations, the BJP has reiterated its demand for a thorough investigation. Mayawati has said the charges are politically motivated.
In the run-up to the U P assembly polls in 2012, Somaiya had made public the names of nine companies in which Kumar was a director. These included Hotel Library Club (registered in Mussoorie), Dia Realtors, Revolutionary Realtors of Mumbai, Om Projects in Kolkata and three companies registered in Siliguri—Tamanna Developers, Harmony Real Developers and Shivanand Real Estate. DLA Infrastructures and Experience Projects were registered in Delhi. Of these, seven companies had accumulated significant cash and bank balances, documents from the Ministry of Corporate Affairs, submitted by Somaiya in support of his complaints, showed.
Hotel Library Club had the largest cash pile of Rs 247.99 crore. Tamanna had Rs 182.61 crore, DLA Infrastructure Rs 105 crore and Shivanand Real Estate Rs 86.68 crore. The cash balances of the other companies stood at Rs 25-Rs 50 crore.
While such balances are not uncommon in the corporate world, it is the way in which these players generated such huge amounts — without much investment or any traceable business activity — that seemed to have caught the attention of the investigators. According to Somaiya, these companies were allegedly used to launder illegal payouts received for allocation of land in Noida. Somaiya had said the 20 companies named by him, which had a cash pile of Rs 1,200 crore, were only a minor part of an empire comprising 300 companies, with cross-holdings and several layers of subsidiaries.
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Explaining the method of the Kumar couple in the case of DKB Infrastructure, Somaiya said, “A criss-cross/web of fictitious companies (are used) to hide owner/actual beneficiary/real investment/flow of funds/colour of money.
Anand Kumar and his wife are real/actual owners of DKB Infrastructure. In the official statement submitted by them/their auditors of the government of India, including the Registrar of Companies, it is stated they purchased shares of DKB from 23 companies.”
These 23 companies were allotted shares from DKB Infrastructure at Rs100 each, a whopping premium of Rs 90. In a few months, these companies showed they sold these shares at Rs 50 to the companies owned by Anand Kumar and Vichiter Lata, Somaiya had alleged, citing documents from the Registrar of Companies. He had demanded Anand Kumar group’s 300 companies be thoroughly proved by the Ministry of Corporate Affairs, the Enforcement Directorate, the Serious Fraud office and the CBI.