Leighton Holdings Inquiry: Syam Reddy also named in 3 CBI chargesheets

It is hard to link an arrest made by the police here on May 13, 2014, with the termination of a Rs 23,000-crore mining contract announced the same day by NTPC in respect of the development of a captive coal block in the North Karanpura block of Hazaribagh district in Jharkhand.

The arrested person in Hyderabad was Raman Srikanth, chief executive of Thiess Minecs India, a subsidiary of Australia's Leighton Holdings, which had won this prized contract from NTPC three years prior to the termination. The arrest was based on a complaint by Hyderabad-based Roshni Developers, whose promoters alleged Thiess had cheated them by not abiding with a contractual obligation under which they were entitled to get the sub-contract of this huge mining project.
 
Roshni spent Rs 185 crore on this project under the impression that they would get the sub-contract, a local police inspector said to a newspaper when the arrest was made. The criminal complaints and arrests had resulted in an out-of-court settlement between the two.

Giving a new twist to this story, Australian media had on Wednesday, citing some documents, reported that the Indian agent of this Australian company had, in fact, bribed Indian officials to secure the contract for Thiess. Giving bribes is illegal under the laws of several countries, including Australia.

The name of this Indian agent was mentioned as Hyderabad-based property developer Syam Prasad Reddy. When asked on Thursday, Indukuri Syam Prasad Reddy, founder of a Hyderabad-based construction and property development company, Indu Projects, denied any links with either Thiess or the scrapped mining project.

While Australian media termed Reddy as Thiess Minecs India agent, the immediate evidence to establish any link between the two comes from an Icra report of 2011. According to the report, Indu Projects held 40 per cent shares in Roshni, besides being the latter's sole client.

Like many Hyderabad-based infrastructure entities, Syam Prasad Reddy's Indu Projects, which also had a coal mining division, grew at a phenomenal speed during that period, securing large irrigation, construction and mining contracts within and outside the state.

However, the allegations in the Australian media against Reddy were nothing compared to what he was already facing here. In 2012 and in 2013, the Central Bureau of Investigation (CBI) had filed three chargesheets on Reddy and his companies, as part of an alleged quid pro quo case filed against Y S Jagan Mohan Reddy, son of Y S Rajasekhara Reddy, state chief minister during 2004-09. Syam Prasad, said CBI, was one of the many businessmen who had made investments into Jagan's companies, in return for favours received from the government headed by his father.