CBI registers Preliminary Enquiry against Chidambaram family in hotel grabbing case

In a blatant instance of hotel grab, Nalini Chidambaram threatened a hotel owner in a telephone conversation

In a blatant instance of hotel grab, Nalini Chidambaram threatened a hotel owner in a telephone conversation of dire consequences
In a blatant instance of hotel grab, Nalini Chidambaram threatened a hotel owner in a telephone conversation

Former Finance Minister P Chidambaram’ family is now paying for their sins and abuse of power. The Central Bureau of Investigation (CBI) on Friday told Delhi High Court (DHC) that a probe has started and that it has registered a Preliminary Enquiry (PE) on November 29 for hotel grabbing by Chidambaram’s family members including wife Nalini and her sister Padmini in connivance with Indian Overseas Bank. The CBI was acting on a complaint filed by the hotel’s first promoter Dr. Kathirvel.  Justice Mukta Gupta ordered CBI to speed up the probe and submit a full report, expressing dissatisfaction on the delayed probe against Chidambaram family’s hotel grabbing.

This case also illustrates how Public Sector Banks like IOB were used for mafia-like operations to grab people’s property.

In 2008, a hotel – Comfort Inn – in Tirupur, run by Kathirvel was forcibly grabbed by Padmini with the help of Indian Overseas Bank (IOB) officials. Chidambaram was the Finance Minister then and the Bank first declared it as a Non Performing Asset (NPA) and initiated an auction illegally. Even after paying the first instalment of the due amount Rs.65 lakhs, the IOB, under pressure from Chidambaram family, conducted a mock auction and awarded the Rs.10 crore worth hotel at around Rs.4.25 crores to Padmini’s firm. Though Kathirvel approached many forums including the Supreme Court and got a stay, Chidambaram family members forcibly grabbed the hotel.

“On May 2, 2008, the promoters of the hotel (Dr. Kathirvel) filed a Special Leave Petition (SLP) before the Supreme Court against the order of the Madras High Court, vacating the stay. The matter was posted for hearing on May 6, 2008 and same was intimated to the Bank by the lawyers of the complaint and not to proceed further till the matter is heard in the Supreme Court. In spite of that on May 5, 2008, the Bank confirmed the sale in favour of Padmini and the Sale Certificate was issued in favour of Padmini after paying the remaining 75% of the bid amount on the same day. The Certificate of sale was also registered in Tirupur Sub Registrar on the same day. Normally, in other cases the bankers usually wait for the final order of the Supreme Court. But in this case, it is suspected that the bankers might have acted in favour of Padmini based on pressure from higher officials of the Head Office level,” said CBI in the 13 page affidavit detailing the frauds and abuse of power committed by former Finance Minister P Chidambaram’s family.

Kathirvel approached the DHC in April 2017 and the Court sought a status report from the CBI. Within weeks, after CBI started action, Nalini’s younger sister Padmini passed away.

In the report submitted to Delhi High, CBI said that on May 6, 2008, the bank officials along with Padmini took possession of the hotel forcibly. Kathirvel in his complaint produced Nalini’s conversations with him to withdraw from the scene after accepting around Rs.2 crores. Kathirvel also produced Chidambaram’s letter to him claiming that he had asked Nalini not to entertain the cases of Padmini. But Chidambaram was seen inaugurating another hotel of Padmini in Tirupur after this incident.

“IOB officials have acted in a hurried manner within a day or two, to facilitate Padmini in acquiring the hotel by not following the banking practice as a prudent banker. The verification also revealed that in other cases, the bankers were giving opportunity to the defaulter to repay the entire loan amount over a period of time, which was not followed in the present case.

“That in view of the above findings, a Preliminary Enquiry was registered by CBI’s Anti-Corruption Branch, Chennai on November 29, 2017, after obtaining approval from the Competent Authority to look into the above aspects and the enquiry is at the crucial stage of finalisation to  unearth the veracity of the allegations/averments mentioned in the complaint,” said CBI saying they would submit a detailed report after the completion of the investigation.

Arguing before Justice Mukta Gupta, Kathirvel’s Advocate Yatinder Chaudhary said CBI is deliberately delaying the matter and sought for a time bound probe. Justice Mukta Gupta said that CBI should file a full status report and can’t delay further. The matter is now posted for May 3, 2018. This means that CBI has to file a First Information Report (FIR) and start questioning Chidambaram and Nalini and top IOB officials.

This case is going to be a nightmare for Chidambaram and his family members. Nalini’s conversation with Kathirvel clearly shows the abuse of power by Chidambaram’s family when he was the Finance and later, Home Minister in Congress led UP Government during 2004 to 2014[1].

This case also illustrates how Public Sector Banks like IOB were used for mafia-like operations to grab people’s property.

Advocate Yatinder Chaudhary tweeted after the court proceedings:

[1] Phone conversation of Nalini Chidambaram exposes her role in hotel grabbingApr 27, 2017, PGurus.com

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  1. my guru you are my inspiration I will fight corruption with utmost honesty, you are exposing politicians , I will expose Raghuram Rajan the biggest crook from Harvard he should arrest,his iit and iim certificates should be returned and should be disqualified from entering in to India and I will make him pay heavy for his mistake , I am writing an article on how he misused his powers within 2 days I will finish that article ,now I am a student in final year after my graduation when you are going to expose all the bankers I want to be your assistant which is like dream come true for me ,but as you justice take time but finally justice only prevails
    thank u for inspiring me, he destroyed the economy with dosanomics which are an utter failure to the Indian system, he helped Karthik and vadra to do short selling, 80:20 gold scheme, American economy to grow
    , he should be arrested under the prevention of corruption act, breach of arrest and so on

  2. Par for the course. This is why Modi and Jaitley are planning to steal our Bank deposits so that Sharad Pawar, Praful Patel, Pranab Mukherjee, Janardhan Poojari, Karunanidhi, and hundreds of others can continue to sleep easy

  3. It is not a surprise that the bank did not follow the usual procedure and acted with undue haste to unseat the original owner of the hotel even when they had partly complied with their directive.As bank chairmen are elected at the whim and fancy of finance ministry it would be very easy to guess who flexed the muscle and twisted the banks arm to indulge in a grossly unethical conduct.That is no excuse for the bank and officials should be punished for their complacency.The politicians deserve to be put behind the Bar for their criminal attitude and misuse of office.


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