The Andhra Pradesh High Court on Wednesday directed the Central Bureau of Investigation (CBI) to register a case against Kadapa MP YS Jagan Mohan Reddy under relevant sections of the Indian Penal Code (IPC), Prevention of Corruption Act and Prevention of Money Laundering Act and conduct investigation into the financial misdeeds committed by him.
The division bench comprising Chief Justice Nisar Ahmed Kakru and Justice Vilas Afzalpurkar delivered the order in the writ petitions heard against Jagan’s companies in regard with the alleged quid pro quo investments made into them by those who had allegedly benefited from the state government when his father YS Rajasekhara Reddy was chief minister.
Referring to huge unexplained cash credits and sale of shares at a huge premium in Jagati Publications set up by Jagan and phenomenal growth in his income, the judges said the court had found prima facie case that explains the financial misdeeds based on the available material submitted by the petitioners.
The court held that the investments made in Jagan’s company were nothing but a quid pro quo arrangement for providing various permission, distribution of projects, real estate ventures and other benefits to the people and companies by the YSR government.
The court order comes after an eight-month-long legal process that started with a letter addressed to the high court Chief Justice by P Shankar Rao, now a minister in the state Cabinet, and a similar writ petition filed by leaders of the Opposition Telugu Desam Party, including former central minister Yerran Naidu, in November against the alleged amassment of wealth by the Kadapa MP.
The division bench on July 12, 2011, had also ordered a preliminary inquiry by the CBI into the financial misdeeds alleged to have been committed by Jagan.
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While referring to the respondents’ request to make available a copy of the report before proceeding with the final orders, the court said it would remain in a sealed cover as the judges had arrived at the present conclusions based on the available material only. “We have taken the decision independently based on the material on record,” they said.
On the respondents’ argument that the writ petitions were nothing but a political vendetta against Jagan, the court said while there was no denying of political rivalries, the dismissal of the petition on that count could not be conceived in the light of huge financial misdeeds presented before the court.
The firms and persons that made investments in Jagan’s companies include Hetero Drugs group, India Cements, Dalmiya Cements, Matrix group of companies, Penna Cement Group, Sajjala Group and 2i Capital PCC and Pluri Emerging Co PCC of Mauritius.
CBI PROBE AGAINST EMAAR GROUP
The high court said it was satisfied with the prima facie evidence of criminal conspiracy resulting in a huge loss to the state exchequer in the Emaar township project deal to order a full-fledged inquiry by the CBI.
The court said the inquiry report submitted earlier to the state government by the Vigilance and Enforce Department in the Emaar-APIIC deal was enough for the prima facie satisfaction of criminal offence committed in the case.
It may be recalled that one of the three special purpose vehicles (SPVs) floated in joint venture by the Emaar group and APIIC was given 258 acres to develop a township project in 2005.
The APIIC later alleged it was duped by its joint venture partner, which had roped in one of its subsidiaries as developer of the project thereby reducing the equity of the state nodal agency.