Coal Import Scam
The Delhi High Court on Monday sought the Centre’s response on the delayed Directorate of Revenue Intelligence (DRI) probe in the Rs.30,000 crore ($5 billion at $1USD = Rs.60) scam in the Coal Import and Power equipment import involving Adani, Essar and Anil Ambani’s Reliance Group. The High Court issued a notice to Centre and the DRI for the delay in the probe in the inflation in imports of coal and power equipment by many corporate groups, which resulted in the increase in the power tariff of the common man.
The pleas have also alleged that the CBI had registered a Preliminary Enquiry (PE) based on the DRI show-cause notice to Adani in May 2014. However, the CBI apparently closed the PE without registering an FIR during the tenure of the then CBI Director Ranjit Sinha, the PIL alleged.
The main petitioner was noted lawyer Prashant Bhushan through a Public Interest Litigation (PIL), who also accused the Central Bureau of Investigation (CBI) for closing the case during the period of former tainted CBI Director Ranjit Sinha. PGurus had reported last year a detailed article about the Coal Import scam and inflation of bills and the role of Public Sector Banks to sabotage the probe of DRI. The major beneficiaries in this scam that happened during the period 2008 to 2011 are the Adani Group, Essar Group and Anil Ambani’s Reliance Group, the three big private players engaged in the power sector.
A bench of Justices S Ravindra Bhat and Sanjeev Sachdeva also directed the DRI to file an affidavit indicating the steps taken by it in the matter and listed the PILs for further hearing on February 7, 2018.
During the hearing, the DRI’s lawyer told the bench that its probe into some of the power firms had ended and an order was expected soon from its adjudicating authority.
The court was hearing two petitions, one by a private individual and another by two NGOs alleging that the power firms belonging to the corporate groups were inflating the value of imports for their power plants to siphon money abroad and avail higher power rate compensation.
Though Coal was imported directly from Indonesia, the bills took a rather circuitous route, using shell companies floated in Hong Kong, Beijing, and Dubai etc. before reaching the importer in India. At each stage, there was a price markup and this blatant fraud ultimately resulted in a significant increase in power tariffs to the common man.
The NGOs have claimed that the DRI had earlier unearthed that public and private sector energy companies were siphoning away several thousands crores of rupees abroad. “Most of these over-invoicing instances have been reported from the power sector, the impact of which is felt by millions of the electricity consumers in the form of higher tariffs,” the NGOs have claimed in their PIL.
“The modus operandi is identical in all these cases. The coal or power equipment, even though (these are) shipped directly to India, but the invoicing is routed through a different company incorporated abroad which is directly owned and controlled by the promoters of the project in India,” the PIL alleged.
The pleas have also alleged that the CBI had registered a Preliminary Enquiry (PE) based on the DRI show-cause notice to Adani in May 2014. However, the CBI apparently closed the PE without registering an FIR during the tenure of the then CBI Director Ranjit Sinha, the PIL alleged. Now Ranjit Sinha is himself facing a probe monitored by Supreme Court for entertaining many corporates including top officers and lobbyists of the Anil Ambani Group and Essar at his home during night hours.
PGurus also reported the shoddy role of former State Bank of India Chairperson Arundhati Bhattacharya for not co-operating with the DRI in an effort to sabotage the probe. It should be noted that the DRI comes under the Finance Ministry. One more area in which Masterly Inactivity is being practised.
 DRI Show Cause notices to Reliance, Adani and Essar – Sep 15, 2016, PGurus.com
 Is Arundhati Bhattacharya protecting Coal importers? – Jul 23, 2016, PGurus.com
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