Scorpene Deal Scam

The Scorpene Submarine Deal Scam is one of India's largest bribery corruption scandals, in which Rs. 500 crore (about USD 10 mn) were allegedly paid to government decision makers by Thales, the makers of the Scorpene submarine. The amount was channeled via middlemen such as Abhishek Verma. Also involved was Ravi Shankaran, a relative of the then chief of navy staff Arun Prakash. He is the prime accused in the Navy War Room spy scandal.

In October 2005, defence minister Pranab Mukherjee approved the Rs 19,000 crore submarine deal with French company Thales. Scorpene submarines are now being built in India under a technology transfer agreement that was part of that contract. The Scorpene Submarine Scandal was yet another scam involved in a multi billion dollar military hardware purchase.

HUDCO Scam, The CIC Report

The HUDCO Scam siphoned crores of rupees as loan. Investigations revealed that there was bribes paid to officials to get these loans meant for upliftment of the poor. The Right to Information Act helped to unveil the mystery behind the Central Vigilance Commission proposing and the CBI disposing in the Rs1,300-crore HUDCO scam. Showing signs of a nexus within the affluents within the government body.

The Central Information Commission directed the CBI to provide the inquiry report on closing investigation in fourcases where the CVC found "adequate evidence of paying bribes" to mobilise funds from Housing and Urban Development Corporation (HUDCO) in 2006. The Central Bureau of Investigation had closed the case saying there was not enough evidence to proceed with the probe. This resulted in the housing and urban development ministry submitting a closure report in Supreme Court in 2007. The corporation had invested Rs. 950 crore in West Bengal Infrastructure Development Finance, Rs. 200 crore in Himachal Pradesh Infrastructure Development Board and Rs. 150 crore in Vidharbha Irrigation Development Corporation.

There were allegations that money was paid to get these funds from HUDCO. “It appears that CVC found clear evidence showing bribes were taken. However, the CBI and the (Housing and Urban Development) ministry have come to the conclusion there is no wrong doing. If corruption is to be curtailed.... citizens need to get information of this nature," Information Commissioner Shailesh Gandhi said.

The CBI's information officer Pradeep Kumar had refused to provide information to RTI applicant AN Gupta on the ground that the probe report was confidential. The investigations were closed in 2007 and that SC was informed about it. Gandhi said the information officer had wrongly applied the exemption clauses and said "mere fears without any justification" could not be grounds for denying the citizen's fundamental right. The commission also said the Kumar had failed to justify the reasons for denying information as stipulated under the RTI Act.

Cobbler Scam - $600 million shoes scam India

India being a large country and blessed with varied natural and cultural diversity is also blessed with a lesser desired blessing, called Scams. A lot of scams are discovered in India every now and then, as if its a day to day routine and like the corruptions in India can never come to an end. If one corruption is exposed another one start somewhere. This also reminds me one of the biggest multi million dollars scam in Indian History which was nicknamed The Great Cobbler Scam.

What really happened in this Great Cobbler Scam was that various businessman & politicians had siphoned around $600 million US dollars from a scheme that was floated by the Government of India meant to benefit the poor cobblers of Mumbai. Instead, it went into the pockets of wealthy elite and bureaucrats who used this money to built luxury homes for themselves and also brought luxury cars, boats, arts...etc. Pretty common use of Tax Payers money.

The money of the scheme to benefit the poor cobblers in Mumbai, was meant to provide low interest loans and tax concessions to the Mumbai's poorest - cobblers who work 16-hours a day for less than $2. Not a single penny of the scheme from the government of India reached these poor cobblers of Mumbai, Maharashtra.

The modus operandi of the masterminds of the cobbler scam was to float a cooperative society of cobblers to avail the soft government loans through various schemes. Several bogus societies of cobblers were formed only for the purpose of availing these soft government loans for the poor cobblers.

The people involved in this racket were Saddrudin Daya, former sheriff of Mumbai and owner of Dawood Shoes, Rafique Tejani, owner of Metro Shoes, Kishore Signapurkar, proprietor of Milano Shoes, and Abu Asim Azmi, president of Samajwadi Party's Mumbai unit and partner in Citywalk Shoes. Beside them various officials of banks and financial institutions were also involved in this multi million dollars Cobbler Scam.

The Banks whose officials were involved in this scam are : Maharashtra State Finance Corporation, Citibank, Bank of Oman, Dena Bank, Development Credit Bank, Saraswat Co-operative Bank, and Bank of Bahrain and Kuwait. All were booked for economic fraud.

This scam costed the Government of India around $600 million US dollars. The cobbler scam was one of the worst scam in India that cheated the poorest people of the society and benefited a lot of rich and elite. Such Scams are one of the cause that proverty in India is difficult to eliminate.

Hawala Money Laundering Scam

The Hawala Money Laundering Scam hovered around the fact that the Hawala channels through which terrorist outfits in Kashmir like Hijbul-Mujahideen used to get funds, the same channels used to grease the palms of over 115 top bureaucrats and politicians of the country. CBI, RAW and every other investigative agencies of the country suppressed the entire Hawala case. 

Indian government accuses Pakistan for encouraging dreaded militant outfit Hijbul-Mujahideen to spread terrorism in India, but why does it not want to investigate the Jain Hawala case, which is directly connected with the funding of the Hijbul-Mujahideen ? It is the same organization which has been behind maximum terrorist attacks and has also caused the Kargil war that took the toll of hundreds of our young officers and soldiers.

The Video is a compilation of a Crusade of one Man Vineet Narain, who exposed the hawala case.

Click the link to know more about Hawala.

Barak Missile Purchase Scam Defense

The Barak missile system was jointly developed by Israel Aircraft Industries (IAI) and RAFAEL Armament Development Authority of Israel.

On 23 October 2000, contracts had been signed by the Indian government to procure seven Barak systems at a total cost $199.50 million and 200 missiles at a cost of $69.13 million. This was done despite objections raised by several groups, including members of the team that had originally visited Israel to observe the missile performance, and APJ Abdul Kalam, then heading the Defence Research Development Organization. Though some of the objections were of a procedural nature, the Navy Chief of Staff Sushil Kumar is currently under investigation as to why these objections were not considered.

In 2001 a sting operation conducted by Tehelka alleged that 15 defence deals made by the government had involved some sort of kickback and the Barak missile deal was one of them. Transcripts of conversations between the undercover Tehelka operative and R. K. Jain indicate that Jain accepted bribes from Suresh Nanda in the amount of one crore.

The NDA government set up a commission to investigate the matter. The UPA government, rejected the partial report by the commission and the Central Bureau of Investigation (CBI) began investigating the case.

The Central Bureau of Investigation lodged an First Information Report (FIR) on 9 October 2006 and claimed that George Fernandes the Indian defense minister at that time, and the Former Chief of the Indian Navy, Admiral Sushil Kumar were involved. The FIR notes that the Indian Defence Research & Development Organization had sought to block the import of the Barak system right until the end. The FIR restates R.K. Jain's admission to Tehelka that 3 per cent of this cost went to Fernandes and Jaya Jaitley as commission, while he himself was given 0.5 per cent. These commissions were paid to them by Suresh Nanda, the middleman in the deal, according to the Tehelka tapes.

Suresh Nanda, his son Sanjeev Nanda, and two others were arrested on the 9 March 2008 under section 120-B (criminal conspiracy) and section 201 (committing offense to cause disappearing of evidence) related to the scandal.

Sukh Ram telecom scam

He himself would have never thought that a bribe of Rs. 3 Lakhs could land him into trouble after 15 years. Special Judge RP Pandey, convicted 84-year-old Sukhram on charges of misusing his official position in awarding the contract and causing loss to the state exchequer, is likely to decide on quantum of sentence to him on Saturday.

The corruption case dates back to year 1996, when the telecom ministry was under Sukhram. Sukhram had awarded private firm Haryana Telecom Limited (HTL) a contract worth Rs 30 crore to supply 3.5 Lakh Conductor Kilometers (LCKM) of Polythene Insulated Jelly Filled (PIJF) cables to the telecom department.
Sukhram had been put on trial along with HTL chairman Devinder Singh Choudhary who died during the trial.
 
"Sukhram also obtained (illegal) gratification other than legal remunerations from Choudhary as a motive or reward for showing the favour to the said firm (HTL)," the judge said.

"It is not the prosecution case that Sukhram got only this much amount in this deal which runs into crores of rupees. The prosecution case is that the amount of Rs 3 lakh which was recovered from him was the bribe money.

"It is a matter of common knowledge that it is virtually impossible to get any direct evidence where both i.e bribe giver and the person who takes the bribe, worked in joint concert," ASJ Pandey said in his 188-page order.

Harshad Mehta Stock Market Scam

Harshad Shantilal Mehta was born in a modest Gujarati family. He was alleged to have engineered the rise of the BSE in 1992 by exploiting several loopholes in the country's banking system.

Harshad Mehta and his associates siphoned off funds from inter-bank transactions and bought shares in huge numbers at a premium across different segments, triggering a false rise in the Sensex.

When the scheme was exposed, banks started demanding their money back, causing the Bombay stock market to collapse. He was later charged with 72 criminal offenses and more than 600 civil action suits were filed against him.

In April 1992, press reports indicated that there was a shortfall in the govt securities held by the State Bank of India (SBI). In about a months time investigations uncovered the securities scam involving misappropriation of funds to the tune of Rs.3,500 crore.

The scam engulfed top executives of large nationalized banks, foreign banks, financial institutions, brokers, bureaucrats & politicians. In less than two months following the scam, the stock prices dropped by over 40%, wiping out market value to the tune of a whopping Rs.100,000 crore.

He took the price of ACC from 200 to 9000. That was an increase of 4400%!!!

The market went up like crazy and the bulls were on a mad run. Since he had to book profits in the end, the day he sold was the day when the market crashed. One lesser known fact about this scam is that there was a very important player in this scam who managed to keep a very low profile. That man was Nimesh Shah. He was just as involved as Harshad Mehta but he knew how keep out of the hands of the law. Nimesh Shah still deals in the stock market and is known to be a heavy player. Harshad Mehta is now dead. It is rumored that when he died, he still had 10% of ACC shares with him.

Reference : http://indiatoday.intoday.in/story/big-bull-harshad-mehta-pays-dues-9-years-after-death/1/132637.htm

Read more at: http://indiatoday.intoday.in/story/big-bull-harshad-mehta-pays-dues-9-years-after-death/1/132637.html

Madhu Koda Mining Scam

On 10 October 2009, he was charged with laundering money. The Income Tax Department uncovered over 4000 crore in illegal assets owned by Koda. Among others, these assets were reported to include hotels and three companies in Mumbai, property in Kolkata, a hotel in Thailand, and a coal mine in Liberia. This alleged scam is said to be the second-largest scam uncovered in India in 2009 and gets his name included in the list of controversial Indian businessman like Hasan Ali Khan and Harshad Mehta.

In the probes, it was found that Maoists received a 30% share of the "Koda plunder". This has led to staunch criticism of Koda from sections of society, including the opposition Bharatiya Janata Party. Gujarat Chief Minister Narendra Modi stated Koda was part of a corrupt network of Congress Party who stole money from Jharkhand.

In July 2011, the Member of Parliament, Mr. Madhu Koda was transferred to Delhi's high profile Tihar Jail from Chaibasa Central Jail after being given permission by the Jharkhand Vigilance Court so that he can attend the monsoon session of the Parliament.

SCAM Indian Premier Leagur Scandal

IPL supremo Lalit Modi (r) with Bollywood stars Shah Rukh Khan (l) and Preity Zinta (2nd from r).

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In April 2010, one of the biggest scandals of Indian sports hit the headlines courtesy Indian Premier League commissioner Lalit Modi and then Minister of State for External Affairs Shashi Tharoor.

What has spelled big business and massive viewership for parent cricketing body BCCI went for a toss when the two high-profile individuals leveled grave charges against each other on the social networking site Twitter.

Modi, who launched the in 2008, accused Tharoor of influencing a $330-million bid for an IPL team (Kochi) and managing “sweat equity” of $15million for his “girlfriend.”

In the political brouhaha that followed Modi’s tweets, Tharoor was forced to resign.

The issue grabbed headlines as the Congress-led coalition government at the center was furiously engaged in securing support over high food prices in Parliament. The government could not let the matter pass.

The government hit back, and federal tax authorities launched a massive probe into the $4 billion IPL sport franchise and Modi.

Isolated, Modi was stripped of his position as IPL chief.

Now the noose is tightening around Modi.

The news Web site Livemint.com reports:
 

Even as Lalit Modi, the suspended chairman and commissioner of the Indian Premier League, dismissed the second show-cause notice issued to him by the Board of Control for Cricket in India as “fiction” on the Times Now TV channel, the game’s administrator in the country is building up its case against him.
 

The second show-cause notice accuses Modi of trying to split the cricket world by starting a rebel league. 

The first show-cause notice is over allegations of wrongdoing in conducting IPL.
 

The e-mailed minutes of a meeting supposed to have been held by Modi March 31 in New Delhi shows that Modi may have discussed a plan to start a parallel 20-over cricket league in the U.K. that mirrors the IPL format. The e-mail was shown to Mint by a BCCI official, who didn’t want to be identified, after Modi dismissed the show-cause notice issued to him on the TV channel.
 

The e-mail, marked highly confidential, was purportedly sent by Stewart Regan, chief executive of Yorkshire County Cricket Club, and gives details of a meeting held by Modi and senior officials of various county cricket clubs in the U.K.

“BCCI has proof that Modi is in advanced stages of planning and discussion with the three county clubs to create a rebel league,” said the BCCI official.

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Cheerleaders at an IPL match epitomized the focus on glitz.

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IPL brought an amalgam of cricket, business and Bollywood, overseen by Modi, to levels never witnessed before in India.

The dizzy heights achieved by the league are unprecedented in the history of Indian cricket and could even overtake big earning sports leagues such as the NBA.

Cutting through red tape and opposition, Modi managed to convert the T20 format into a power-packed high voltage three-hour drama of cricket, business, glamour and late night parties. The big money being splashed about catapulted Modi into instant stardom.

Last year, the brash chairman even transferred the IPL event to South Africa when security concerns and general elections loomed large.

Most feel he got too big for his boots when he tried to take on Tharoor, a sitting minister. The ensuing scandal threatened to ensnare the beneficiaries of the cricket moolah -- top Bollywood stars (team owners, real or purported), senior politicians and high flying corporate czars were under the scanner of the taxmen, media and thus the public.

Modi’s business methods have the transparency of mud. He is being accused of favoring relatives, family and close friends.

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Shilpa Shetty, one of many actors who added a dash of Bollywood glamour to IPL.

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The allegations against Modi entail manipulation of team auctions, using family and friends as proxies for his holdings, accepting bribes for advertising deals and routing investments through tax havens like Mauritius and British Virgin Islands without keeping the information above board.

Then there is the suspicion of Modi pocketing $80 million “facilitation fee” for awarding television rights of IPL, besides holding a substantial stake in the IPL team Rajasthan Royals.

Forbes India reports that Modi got into trouble with Home Minister P. Chidambaram last year:
Apparently, Modi had gone to the home minister’s office to seek clearances for the league matches. But in an appalling breach of protocol, he refused to wait for his turn to meet Chidambaram and instead attempted to barge into the minister’s office. Now, Chidambaram is the kind of man who doesn’t suffer either fools or arrogance and promptly asked Modi to leave. A miffed Modi said some daft things, stormed out of the room and eventually created an altogether avoidable controversy that snowballed into Season 2 being shifted to South Africa. . .
 

Much has been made and written of his brusque and arrogant nature. Both of which are on abundant display when he tried to bulldoze his way through Chidambaram’s office. Fact is, he is also a bully. And the defining trait of all bullies is that they cow down where glowered at. Why else do you think he’s been desperate to mend fences with Chidambaram?

Then of course, there is his legendary capability to execute relentlessly what he sets his mind to. How many men do you know of who can take one of the largest sporting shows on earth and move it to another country in three weeks flat? For that matter, how many men have you heard of who’s built a franchise that’s worth more than $4 billion in just about three years?
 

All of this said, a couple of questions remain. How in the devil’s name did Modi manage to pull off something as significant with an entrepreneurial zeal that can be only described as mercurial? More importantly, how did he manage to create the astronomical valuations that the IPL now commands? Answers to these questions reveal a tale of uncanny entrepreneurship and a remarkable ability to subvert the system he operates in.

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A Kolkata Knight Rider fan.

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Multiple issues are still under investigation even as Modi has handed a very bulky 15,000 page answer to 22 counts of charges of corruption leveled by the BCCI.

Some allegations have also been put forward from Britain that Modi attempted to fracture local cricket and nurtured ambitions to create an England-based cricket League.

The charges wiped out every bit of support Modi had.

Modi supporter Sharad Pawar (Congress party top dog and agriculture minister, president elect of the International Cricket Council and former head of the Indian Cricket Board) could not save Modi from being replaced by an Interim IPL head, Chirayu Amin.

Recently, a meeting was held by the BCCI and IPL interim chairman Amin to discuss last season’s IPL and its continuance.

The nexus between politicians and sports is well established in India and seen as one big reason for the abysmal state of affairs. The country barely manages to make a mark into the medal charts of Olympics or other world events.

With big money being churned at IPL, it was inevitable that the cricket pie would have all sorts of vested interests jostling for a share. There was a clear lack of interest by the authorities till the careless tweets came up.

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India is a country where the poor earn less than $2 a day and over 37 percent of the population subsists below the poverty line. The grant of tax concessions, security subsidies, low rentals of stadia and other freebies for the various IPL events just does not seem right.

Scandals such as these focus on the need of the government to fulfill its role as a proper regulator, watchdog or supervisor. There is need to reform, restructure and revamp the system and the way sports are handled, apart from infusing transparency.

The loopholes need to be plugged along with adoption of best practices and a clear cut policy on the issue of “sweat equity” (read undeclared assets and influence) that provides scope for power plays by politicians.

Sports bodies need to be managed the right way by professionals so they can sustain revenues that in turn should be utilized for furthering the cause of sports in India.

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IPL cricket league represents a dizzy mix of sport, business and entertainment so much so that Modi called it “cricketainment.”

Yet Indians who have worshipped cricket as a religion and cricket stars have reason to feel cheated.

So what’s next? Have Modi and IPL become inextricably linked?

According to Forbes India:

 
There are doubts about the IPL’s future if Modi is removed. Will his replacement, Chirayu Amin, be able to give the same amount of commitment? And more importantly with its numero uno decision maker gone, will the IPL retain its ability to think on its feet? “Modi is a one-man show,” says a person who works with him. “You would think someone who handles hundreds of crores worth of deals would have learned to delegate. But no, even for the MRF blimp that cost a measly Rs. 15 crore, Modi took the call,” he says. Amin is a BCCI member with no stake in any franchise. He runs his own company. Will he bring the same amount of energy into the IPL? And more importantly will he be able to balance franchisee interests along with BCCI interests?

The IPL may run along without Modi but don’t expect the same style and grandeur that he brought to the event. Yes, his wings need to be cut because too much power in one individual’s hands is bad for any organization. “Modi hasn’t put any systems in place. You get the feeling he is actually indispensable,” says a sponsor.

Source: Siliconeer 

Naval War Room Leak Scandal

In July 2005, Outlook magazine reported that some classified documents were leaked on a USB pen drive from the Directorate of Naval operations in New Delhi (also called the Navy war room). However, they were intercepted by air force intelligence from the house of wing commander S L Surve. The military documents, which dealt with Indian defense purchases, were supposed to be passed on to Thales and other international arms sellers via Shankaran.

After the leak was exposed, the Navy conducted its in-house investigation, and in December 2005, it sacked three commanders in the Indian navy, Vijendra Rana, Vinod Kumar Jha and Captain Kashyap Kumar, without any investigative or court trial. Officially, the reason given for their dismissal under the rarely-used "President's `Pleasure" clause, was because they had leaked classified information after accepting gratification, and this may affect the "security of the State", but the lack of criminal charges against the three has been very surprising. In fact, the Indian navy did not pass on the case to the nodal investigative agency, the Central Bureau of Investigations until nearly a year had passed after the initial break on the scandal, while others hinted that the investigation may have been deliberately delayed, possibly to protect Shankaran.

Ravi Shankaran and other accomplices named in the media expose were allowed to leave the country. After the media clamored about the Indian navy investigations on the War Room Leak Scandal, investigations were handed over to the CBI. Raids were conducted in 20 offices and residences nationwide, Shankaran's friend and business partner, retired Commander Kulbhushan Parashar was arrested in April 2006 at the Indira Gandhi Airport in New Delhi. The large number of documents uncovered by the CBI resulted in many more arrests such as arms dealer and billionaire Abhishek Verma and Wing Commander S.L. Surve. Also arrested was Rajrani Jaiswal from Pune, who was apparently used by Kulbushan Parashar as a "honey trap". Surve, who was posted as joint director (air defence) in the Air HQ, was so besotted with Rajrani that Surve's wife complained to the Indian Air Force (IAF) about them. Eventually Surve was fired, and both he and Verma are presently in jail.

However, Shankaran had left the country in November 2005 - well after the media publications, but during the Indian Navy's internal investigations. The CBI found that he had been staying with relatives in London. An Interpol Red corner notice was issued against him in 2006. His passport was revoked and his property was attached in September 2006. He was also spotted in London and an UK court issued an arrest warrant, but he evaded the police and apparently went to Sweden.

In Dec 2007, Arun Prakash responded to the media in a public statement quoting a CBI document:

The investigation so far, leading to the filing of two charge sheets has not revealed any incriminating act on the part of Admiral Arun Prakash with regard to this conspiracy.

It appears that Shankaran and Parashar, both of whom had taken early retirement from the navy, had convinced their friends commander Vijendra Rana, commander Vinod Kumar Jha, and the then director of naval operations Captain Kashyap Kumar to enable the copying of classified information from the Navy War room in the South Block. Eight pen drives were used to carry the information to their contacts in international armament companies interested in selling to India. Only two of the eight pen drives could be recovered.

Subsequently, the War room leak was linked to the Scorpene Submarine scam, in which 500 crores (about USD 100mn) were paid as bribes to parties in India.

In April 2010, four years after the Interpol Red corner notice had been issued against him, Ravi Shankaran was arrested in London. Reports indicate that he was being extradited via proceedings in the court of District Magistrate, Westminister's Court, London. However, in over a year, he is yet to be extradited as of June 2011. Meanwhile, he is on bail in London.

Uttar Pradesh Food Grain Scam

Uttar Pradesh food grain scam took place between years 2002 and 2010, in Uttar Pradesh state in India, wherein food grain worth INR35,000 crore (US$7.1 billion), meant to be distributed amongst the poor, through Public Distribution System (PDS) and other welfare schemes like Antyodaya Anna Yojana (AAY), Jawahar Rozgar Yojana and Mid-day Meal Scheme for Below Poverty Line (BPL) card holders, was diverted to the open market. Some of it was traced to the Nepal and Bangladesh borders, as in 2010 security forces seized Rs 1.17 crore worth of foodgrains like paddy and pulses being smuggled to Nepal, another Rs 60.62 lakh worth of grains were confiscated on the Indo-Bangladesh border.

The scam first came into light in 2003, during the Chief Minister ship of Mulayam Singh, in Gonda district in the distribution of foodgrain meant for the Sampoorna Grameen Rozgar Yojana and soon complaints started pouring in from other districts as well. After initially ordering an inquiry into the scam Mulayam Singh withdrew it. The Special Investigation Team ( SIT) set up by the Mulayam Singh government in 2006, lodged over 5,000 FIRs. Subsequently the next UP chief minister Mayawati upon assuming office, ordered a CBI probe into the scam on December 1, 2007. Media dubbed it, "mother of all scams", and TV news channel, Times Now reported the scam which started in 2002, under the reign of following Chief Ministers of Uttar Pradesh, estimated to be at over INR200,000 crore (US$40.56 billion).  Uttar Pradesh as with other states and UTs, is allocated a monthly quantity of foodgrains, i.e. rice and wheat, by the Central government for distribution amongst AAY, BPL and APL families, under TPDS managed by the state government. For the period from Apri1 2010 to March 2011, this quantity for the state was 528395 tons.

The latest of the scam series in India, initially referred as the 'UP rice scam' could be the biggest of them all, even outdistancing the so called 2G Spectrum scam. The scam involves goofing up of rice worth INR200,000 crore (US$40.56 billion). It was a scam that stretched to almost 7 years and 300 FIRs. The scam was reported in UP (Uttar Pradesh, India) between the years 2003-2007, the period when Samajwadi Party leader Mulayam Singh Yadav was the chief minister of the UP.

Andhra Pradesh Industrial Infrastructure Corporation Controversy

Andhra Pradesh Industrial Infrastructure Corporation Ltd also known as APIIC has been embroiled in a controversy over land acquisition for the Boulder Hills project in Hyderabad, a joint venture with EMAAR-MGF. News reports suggest that the APIIC agreed to dilute the public stake by undervaluing the land that it contributed. About 500 acres of land was acquired by APIIC in 2002-2003 for setting up a golf course and residential properties. Of the 535 acres of land in Manikonda near the Indian School of Business, APIIC sold 285 acres at 27 lakhs per acre as against the prevailing price of 1 crore per acre in 2003. The remaining 235 acres (and an additional 15 acres of unusable land) were allotted as a 66 year lease with a 2% share of the Golf course revenues. EMAAR sold this project to EMAAR-MGF and diluted the value of APIIC's stake from 26% to 4%, by not considering the prevailing market rate for the land in 2009.

Multiple claimants to the land have emerged, including the WAKF board and the previous farmer owners of this land. The customers who have paid for properties in the developed project are in jeopardy due to the unclear land title. On the back of the controversial Boulder Hills deal with EMAAR-MGF, several other APIIC projects, including the Raheja Mindspace IT park, that were approved in the period between 2003 and 2009 are being questioned. There are allegations of irregularities in land deals during the Chief Ministership of Y.S. Rajasekhara Reddy.

There are also allegations that government officials were allocated parcels of the property at deeply discounted prices compared to the prevailing market price. Officials who previously ran APIIC and seem to have conflicts of interest with the developers, have refuted many of these allegations and defended earlier land allotment decisions.

There have been several calls for a thorough investigation into APIIC deals either by the CBI or by the state investigative agency CID. Though there were initial reports of an external audit, the calls for a CBI enquiry were downplayed by the Andhra Pradesh Government, which has initiated an internal APIIC probe.

Land Scam: Lavasa Scandal

The Union environment ministry has issued a show-cause notice to Lavasa Corporation, which is constructing a 25,000-acre hill township near Pune, alleging myriad violation of environmental laws. The company, promoted by a clutch of investors led by Hindustan Construction Co, will have to stop construction work immediately.

The notice from the ministry continues a high-profile crackdown by Jairam Ramesh, the environment minister, on violators of India's hitherto loosely-enforced environmental laws. The high-profile project, described as independent India's first hill city, may get away by paying a "hefty penalty" according to sources in the environment ministry.

This penalty will have to be paid if the company is unable to explain violations including construction above 1,000 metres from the sea level, and construction without prior clearance over an area more than 20,000 sq.mts. The second phase of the project is unlikely to receive clearance in the wake of the new findings, they added.

The move pulled down HCC stock, and may impact the company's proposed initial public offering. On Friday, after the news of the show-cause notice to Lavasa, shares of Hindustan Construction Company slipped 19% to close at Rs 40 on the National Stock Exchange.

The stock had declined 11% and 2.9% on Thursday and Wednesday after Lavasa's name cropped up in an unrelated scam involving alleged payment of bribes by a number of companies, largely real estate forms, to bank officials. News of that scam broke on Wednesday.

It came out that the company had used Money Matters, a debt arranger at the heart of the scandal, for some property transactions. Ajit Gulabchand, the chairman and managing director of HCC, has said these transactions were completely legal. The environment ministry had sought a report from the Maharashtra environment department in June after a complaint by an NGO called the National Alliance of People's Movement.

The state government arm responded in August saying that a no-objection certificate by it was later converted into a final environmental clearance based on two assumptions: buildings had been built below 1,000 metres, and the proposed construction was limited to an area less than 2,000 hectres. Both limits have been breached, the stare government's report says.

The Union ministry has been able to intervene due to an Environment Impact Assessment Notification issued in 1994 (later amended in 2004), according to which any new industrial estate that had commenced without central clearances under the notification, will now be required to do so if construction work had not commenced as on July 7, 2004, or if the expenditure occurred till that date had not exceeded 25% of the sanctioned project cost.

According to the report by the Maharashtra environment department, the project cost incurred by the 2004 threshold was only 5.33% of the total cost. The project, which has often been linked to Union agriculture minister Sharad Pawar, will now have to get fresh clearances from the ministry.

Mr Pawar, in a recent newspaper interview, had strongly defended the project, saying it aimed to create a modern hill station, something which had ceased after independence. Mr Pawar had said in the interview that he had personally identified the areas where such a hill station might be set up.

The Union environment ministry's intervention might affect the company's plan to float an initial public offering (IPO). The company had filed a draft red herring prospectus with the market regulator and last week and the Securities and Exchange Board of India had approved the proposal.

The corporation aims to raise Rs 2,000 crore through its IPO. A company spokeswoman refused to comment in detail on the showcause beyond saying, "we have received the notice and senior management is studying the same and contemplating a response".

HCC owns 64.99% stake of Lavasa Corporation. Other major investors include Gautam Thapar's Avantha Group with 16.25%; Venkateshwara Hatcheries, which recently bought the English Premier League club Blackburn Rovers, with 12.8%; and individual investor Vinay Vithal Maniar with a 6% stake.

A number of banks have significant exposure to the Lavasa project. These include ICICI Bank (Rs 250 crore), Axis Bank (Rs 225 crore), Bank of India (Rs 150 crore), Allahabad Bank (Rs 500 crore) IndusInd Bank (Rs 500 crore), Andhra Bank (Rs 250 crore), Union Bank (Rs 500 crore) and Jammu & Kashmir Bank (Rs 100 crore).

Earlier this year, an inquiry by the state government suggested the Lavasa deal has deprived Maharashtra of revenue. An inquiry conducted by the Maharashtra revenue department says that Lavasa bought 600 hectares of land from farmers who had been given land by the state. Lavasa should have paid 75% of the price of the land to the state, therefore. Instead, it paid 2% to the government.

But company officials say that Lavasa bought 350 hectares, not 600 hectares as stated in the report. It paid 2% because the collector's office demanded this amount. The government report also says Lavasa bought 98 hectares of tribal land without the prerequisite clearance from the government, a charge Lavasa denies completely.

The report also finds fault with the state's irrigation department MKVDC for leasing 141 hectares of land at throwaway rates to Lavasa. The government at no point sanctioned this lease and while the market price should have been Rs 20 crore a year, the lease was signed for Rs 3 lakh a year. Lavasa argues that the lease- signed in 2002 was based the price based on the market rates at that time.

India Scandal Belekeri port scam

The Belekeri port scam relates to 3.5 million tons of confiscated iron ore that was exported illegally from Belekeri port near Karwar in Karnataka. After Deputy Conservator of Forests R. Gokul seized the ore and the high court refused to permit it to be exported, a large part of it was surreptitiously exported from the port. After persistent protests and public pressure, Karnataka Chief Minister Yeddyurappa, who is balancing political considerations with control of corruption, admitted to an illegal iron-ore export racket at Belekeri Port involving 35 lakh metric tonnes of iron ore. It is said that the scam was worth an estimated 60,000 crore rupees.

This iron ore from the Bellary region is alleged to have been illegally mined after paying a minuscule royalty to the government. The major irregularities involve mines in Bellary, including those of Obulapuram Mining Company owned by G. Karunakara Reddy and G. Janardhana Reddy, who are ministers in the Government of Karnataka. A report constituted by the Lok Ayukta uncovered major violations and systemic corruption in mining in Bellary, including in the allowed geography, encroachment of forest land, massive underpayment of state mining royalties relative to the market price of iron ore and systematic starvation of government mining entities.This report was finalized and prepared with inputs from the Income Tax Department's Commissionerate of Central Circle.

Justice N. Santosh Hegde resigned from the Lokayukta position on 23 June 2010 after an honest officer (Deputy Conservator of Forests R Gokul) was suspended by order of minister J. Krishna Palemar and he felt powerless to help. He expressed inability to be effective in his anti-corruption mandate owing to a non-cooperative Government of Karnataka. Amid media speculation that the ports minister Krishna Palemar had recommended Gokul's suspension on behalf of some politicians with business interests, Palemar defended his recommendation to suspend Gokul, saying Gokul had failed to attend a meeting, and "this raised suspicions that he too might have had a role to play in this particular incident. Because of this I recommend that he be placed under suspension".

Hegde's resignation sought to underline the helplessness of the advisory post of the Lokayukta in such situations. The resignation has brought considerable public attention on the scam, whose existence the government has also been forced to admit.

Haridas Mundhra scandal – The first big financial scandal of free India

Haridas Mundhra was a Calcutta-based industrialist and stock speculator who was found guilty and imprisoned in the first ever big financial scandal of free India in 1957. The Mundhra scandal also exposed the growing rifts between the then Prime Minister Jawaharlal Nehru and his son-in-law Feroze Gandhi, and also led to the resignation of India's then finance minister T. T. Krishnamachari. Haridas Mundhra scandal is the biggest example - that the branches of corruption grows thicker if their roots are not destroyed at very beginning.

In 1957, Mundhra with his nefarious intentions got the government-owned Life Insurance Corporation (LIC) to invest Rs. 1.24 crores (about USD 3.2 million at the time) in the shares of six troubled companies belonging to none other than Mundhra: Richardson Cruddas, Jessops & Company, Smith Stanistreet, Osler Lamps, Agnelo Brothers and British India Corporation. The investment was done under governmental pressure and it also bypassed the LIC’s investment committee, which was informed of this decision only after the deal had gone through. In the series of events of the first scam of India, LIC suffered loss to most of the money.

During Investigations, the Justice M.C. Chagla (a one-man committee  for Commission of Enquiry) determined that the then Finance Secretary of India, Haribhai M. Patel, along with two Life Insurance Corporation of India officials, L S Vaidyanathan, may have colluded on the payment, and should be investigated. Subsequent inquiry committee headed by Retired Justice Vivian Bose cleared the names of two civil servants but passed strictures against finance minister for “lying”. The Finance Minister T. T. Krishnamachari, in his testimony tried to distance himself from the LIC's decision, implying that it may have been taken by the Finance Secretary, but Justice Chagla held that the Minister is constitutionally responsible for the action taken by his secretary and he disown his actions. Eventually, Krishanamachari had to resign. The Nehru government suffered considerable loss of prestige with the exposure of this incident.

Haridas Mundhra was arrested from his luxury suite at the Claridge’s Hotel in Delhi, and sent to prison.
It turned out that Mundhra’s manipulations were not restricted to LIC. The income tax department had curiously withdrawn certain notices pending against him having entered into “some understanding” about the payment of arrears.

In recent times, Mundhra is often noted as the forerunner of other financial scamsters of modern India, including Harshad Mehta and Abdul Karim Telgi, who also operated with considerable political connivance.

Reference : http://en.wikipedia.org/wiki/Haridas_Mundhra

Kargil Coffin Scam India

Post Kargil war with Pakistan in the Kargil sector of India. The CAG found abnormalities in the purchase of Coffins for the Martyrs of the Kargil War. The nature of the irregularities committed in clearing certain defense deals mentioned in the Comptroller and Auditor-General's report showed gross irregularities were committed in the purchase of coffins by the Army during the Kargil operation.  The caskets that were bought from US-based funeral service company Buitron and Baiza for the slain soldiers in the Kargil war were allegedly purchased at a price higher than the actual cost.

The Bharatiya Janata Party - led government decided to go in for emergency purchase of coffins following the action in Kargil that resulted in the death of more than 500 jawans and army officers. The scrutiny of records by the CAG showed that some middlemen made huge profit by supplying the coffins at highly inflated rates. The Indian government bought about 500 caskets for 2,500 dollars each, which is believed to be thirteen times higher than the actual price. The government incurred a heft loss of 1,87,000 dollars in the purchase.

Of course, the supplier on his own could not have been able to palm off substandard "imported" coffins without the help of willing insiders who must have been bribed for clearing the deal. The Army top brass is not usually involved in the purchase of defence material and equipment. The placement of orders is routed through civilian agencies.

The investigation was passed on to the CBI which filed a Chargesheet in 2002 following the Coffin scam related to the Kargil War netween India and Pakistani hired Islamic militants. The three Indian army officials named in the chargesheet are Major General (retired) Arun Roye, Colonel (retired) SK Malik and a serving officer Colonel FB Singh; along with the American manufacturer of the aluminium caskets.


Surprisingly, the name of the then Defense Minister George Frenandis was missing from the reports. He was given a clearance and a clean chit from the scam.

There was a huge uproar and rage in India after the Coffin Scam was unearthed, there is another aspect that needs to be explained in context to the India Pakistan Kargil War Coffin Scam. India is now counted among the fastest growing economies in the world. And yet it still does not have the wherewithal to produce body bags and aluminum coffins for meeting domestic needs! It is evident that all aspects of the coffin deal need be investigated by the vigilance and other concerned agencies. And the culprits should be awarded harshest possible punishment for their role in the despicable deal.

Mumbai Adarsh Society scam scandal

In 2010, the Indian media brought to public the alleged violations of rules at various phases of construction in the Adarsh Society. Questions were raised on the manner in which apartments in the building were allocated to bureaucrats, politicians and army personnel who had nothing to do with Kargil War and the way in which clearances were obtained for the construction of the building of the Adarsh Society. The Adarsh society high-rise was constructed in the Colaba locality of Mumbai, which is considered a sensitive coastal area by the Indian Defence forces and houses various Indian Defense establishments. The society is also alleged to have violated the Indian environment ministry rules. Activists like Medha Patkar had been trying to uncover the problems since at least 2004. It had led to resignation of the then Chief Minister, Ashok Chavan.

Several inquiries have been ordered by the army and the Government to probe into the irregularities. Some of the current occupants of the flats in the Adarsh co-operative society building have offered to vacate their flats at the earliest, denying allegations that they were alloted flats because they influenced or helped, in some manner, the construction of the society by violating the rules.

CBI Report in SNC Lavalin Scam

In the progress report filed before the CBI Special court by the CBI Chennai unit Dy SP, V Ashok Kumar, it has been stated that Pinarayi Vijayan, the former Electricity Minister of Kerala should be named and arraigned as the ninth accused in the SNC-LAVALIN Scam.

Claus Trendl, Senior Vice President of the Canadian firm SNC-Lavalin, has been named and arraigned as the 11th accused and A. Francis, former Joint Secretary (power) as the tenth accused.

During the course of investigation, Vijayan's involvement came to light apart from the other accused, CBI quoted in its report. Vijayan, while serving as Kerala's Electricity Minister between May 1996 and October 1998, colluded with K. Mohanachandran, Principal Secretary (Power) and joined criminal conspiracy which was already hatched in 1995 by R. Sivadasan, former KSEB chairman and others in the matter of awarding supply contracts of the electrical projects to Lavalin, the CBI stated. Vijayan had led a high level delegation to Canada in October 1996 and held discussions with SNC-Lavalin and Export Development Corporation International Development agency regarding the contract and took a decision in awarding the supply contracts to Lavalin at a fixed rate basis. The main consideration in the award of the contract, which was signed by KSEB on February 10, 1997 without Government approval, was the grant offered for establishment of Malabar Cancer Centre (MCC) at Thalassery in Kannur district.

The E. Balanandan committee, appointed by the Kerala government, in its report had opined that the complete replacement of the machinery need not be carried out for the hydel projects and essential parts and machinery alone need to be replaced for which the estimated cost will be around Rs 100.5 crores. This recommendation was overlooked and the supply contract was signed within a week after Vijayan received the report. CBI said Vijayan along with the then Chief Minister, the late E. K. Nayanar and the late Dr. V. Rajagopal, former KSEB chairman, again visited Canada during June 1997 where the grant amount to establish the MCC was decided at Rs 100 crores.

The CBI stated that Vijayan along with the other accused had, 'fraudulently with dishonest intention' of showing undue favour to SNC Lavalin, entered into only a 'non binding' memorandum of understanding on April 25, 1998 for MCC instead of a legally valid memorandum of agreement which facilitated SNC-Lavalin to back out from the commitment later, thereby 'cheating the government'. K. Mohanachandran and A. Francis signed the MoU and no Government order was issued authorizing K. Mohanachandran to sign the same, but there was concurrence of Vijayan.

Lavalin, taking advantage of the non binding agreement, backed out of the commitment after spending only about Rs 12 crore through its consultants, thus not financing MCC to the tune of Rs 86.25 crore.

As part of the criminal conspiracy, Vijayan, K. Mohanachandran and A. Francis and others placed a crucial note for approval before the Countil of Ministers on March 3, 1998, after suppressing various facts, including the fact that MoU route was dispensed with the Union Government, full report of the National Hydroelectric Power Corporation was not highlighted and concurrence of Central Electricity Authority, and obtained cabinet approval. Vijayan also had close contacts with SNC-Lavalin officials and by abusing his official position had exerted 'high pressure' on the staff of Kerala State Electricity Board and thereby favoured Lavalin in their official dealings with KSEB, Central Bureau of Investigation said. The investigations revealed that the supply contract for renovation and modernization of the Panniyar, Shengulam and Pallivasal hydel projects was given to SNC Lavalin at an exorbitant rate and the per MW cost for the same was the highest. This caused a loss to the Government of Kerala with corresponding wrongful gain to Lavalin.

CBI requested an order for prosecuting Vijayan and Government took a decision not to allow the prosecution later this was taken before the governor of kerala. on June 6, 2009 the governor ordered CBI to start prosecution of Pinaray vijayan.

Later CBI filed an affidavit in court giving a clean chit to Vijayan. The CBI filed the affidavit in response to a public interest litigation seeking to know the progress in the probe and alleging that Vijayan misused his position to amass wealth.

BL Kashyap EPFO Scam

One of India's fastest-growing construction firms has been charged with carrying out the country's biggest provident fund (PF) evasion. BL Kashyap and Sons Ltd — whose clients include Microsoft, IBM, Taj Hotels and Delhi's international airport — has been asked to fork out Rs 593 crore in PF dues and penalties.

The Employees' Provident Fund Organisation (EPFO) has warned that if the company fails to pay up by August 15, recovery proceedings will be initiated against it for evasion of workers' PF payments from April 2005 to December 2010.

Shares of BL Kashyap & Sons were down 20 per cent to hit a lower trading limit after ET's report. However, the company denied any wrongdoing, saying the EPFO order was "totally erroneous, misconceived and perverse on various grounds." At 9.29 a.m., shares of the company were down 20 per cent to Rs 15.20.

The country's retirement fund regulator has also filed a police complaint against top officials of the company for forging employee muster rolls and submitting fake records, after a forensic analysis revealed the same thumb impression had been put against the records of several employees.

BL Kashyap and Sons, however, denies any wrongdoing and says the EPFO order is "totally erroneous, misconceived and perverse on various grounds". "No employee has complained against us. Moreover, no beneficiary(ies), for whom the recovery is being made, have been identified," said a company statement.

"It can be verified that we are making more EPF contributions than many other construction companies though their turnover is more than us. We are examining the order and shall take appropriate legal recourse available to us at the earliest," the company said.

The provident fund rules stipulate that 12% of the basic salary of all employees earning up to Rs 6,500 a month must be compulsorily deposited in their PF accounts. The employer makes a matching contribution.

Last month, the Central Bureau of Investigation (CBI) had booked nine senior EPFO officials and top officials of the company for criminal conspiracy and forgery, estimating wrongful gains ofRs 169 crore for the firm. But the PF department has alleged the actual evasion could be nearly four times the CBI's estimate.

Between 2006-07 and 2010-11, BL Kashyap and Sons excluded nearly 71,000 workers from PF benefits, according to the EPFO order. The regulator received several complaints between 2005 and 2009 about the company denying retirement benefits to workers across its construction sites. The EPFO found huge variations in the wage payments booked by the firm in its audited balance sheets and the records submitted to the PF office, leading to suspicion that it employed more workers than it claimed.

Regional PF Commissioner Gautam Dixit, who is in charge of the Delhi (South) PF office, passed the order against the company on July 29 — after nearly six months of investigations and 20-odd hearings with the company. The Rs 593-crore notice served by the EPFO includes about Rs 437 crore that the firm should have paid into workers' retirement accounts, and penal interest of Rs 156 crore, as per the assessment order in ET's possession. Shares of BL Kashyap closed at Rs 19.15 on Wednesday.

The firm's employee costs amounted to Rs 544 crore in 2010-11, when it made a profit of Rs 48.8 crore on revenues of Rs 1,586 crore. The company's board is expected to meet on August 12 to approve its first quarter results.

According to the EPFO order, the company deprived workers of their PF benefits by claiming that all 'excluded' employees earned more than Rs 6,500 per month. However, wage payment records revealed that thousands of such workers got much less than Rs 6,500 per month.

This, the company argued, was because workers were proceeding on 'leave without pay', though it failed to back the claim with leave registers. "This argument can be true for some workers at some sites in some months, but not for thousands of cases every month across all sites... This implies that in almost every month work would come to a standstill or suffer heavily, since large numbers of workers were on leave without pay," the EPFO order noted.

Bogus records for employees excluded from PF benefits were nailed when they were sent to two forensic labs for verification, including the Central Finger Print Bureau under the home ministry. The analysis revealed that the wage rolls of several workers bore the same thumb impression.

In July, the CBI had booked an additional central PF commissioner and eight other officers for entering into a criminal conspiracy with BL Kashyap's top officials.

The CBI found that PF officials actively helped the company create false records in respect of certain employees and manipulated the firm's provident fund dues by 'inflating' the number of workers not eligible for PF.

Source: Economic Times

2G spectrum scam Radia Tapes Controversy

After getting authorization from the Home Ministry, the Indian Income Tax department tapped Radia's phone lines for 300 days in 2008-2009 as part of their investigations into possible money laundering, restricted financial practices, and tax evasion.In November 2010, OPEN magazine carried a story which reported transcripts of some of the telephone conversations of Nira Radia with senior journalists, politicians, and corporate houses, many of whom have denied the allegations.

The Central Bureau of Investigation has announced that they have 5,851 recordings of phone conversations by Radia, some of which outline Radia's attempts to broker deals in relation to the 2G spectrum sale. The tapes appear to demonstrate how Radia attempted to use some media persons to influence the decision to appoint A. Raja as telecom minister. In the recorded conversations between Nira Radia and prominent figures, referred to as the Radia Tapes, several prominent figures are heard in conversation with Radia:

• Politicians

• A. Raja, Telecom minister
• Kanimozhi, Rajya Sabha MP
• Businessmen 
• Ratan Tata, Chairman, Tata Sons
• Journalists
• Barkha Dutt, Group editor, English news, NDTV 
• M.K. Venu, senior business journalist
• Prabhu Chawla, editor of India Today magazine
• Rajdeep Sardesai
• Shankar Aiyar, then with India Today Group
• Vir Sanghvi, HT advisory editorial director

• Industry Heads
• Tarun Das, former CII head

• Others
• Ranjan Bhattacharya(foster son-in-law of former prime minister Atal Behari Vajpayee) 
• Suhel Seth, management guru and columnist

Were the few prominant faces that came to light in this controversy.

SNC Lavalin Financial Scam

In one of the scams in Kerela known as the SNC-Lavalin Scam, the Kerala State Electricity Board (KSEB) signed a memorandum of understanding (MoU) with SNC-Lavalin in August 1995. During this scam G. Karthikeyan of the Congress Party was serving his tenure as the Minister for Electricity. Under the provisions signed in the MoU, the funds for the renovation of Hydel Power Projects were to be arranged by SNC Lavalin from the Export Development Canada (EDC), Canada, and the Canadian International Development Agency (CIDA). The Board did as per according to the MoU, however it ignored the Central Electricity Authority's (CEA) recommendation that immediate replacement of the generating units at the Pallivasal power station was not called for as the plant was in fairly good condition. The Board undertook a feasibility study on the proposal only in September 1995, by a retired Chief Engineer of the KSEB, who later became a consultant to Lavalin.

Based on the consultant's report and further discussions, the Board signed contracts with SNC-Lavalin to provide technical services for management, engineering, procurement and construction supervision in February 1996, to ensure completion of the projects within the prescribed time of three years. Again durign this period G. Karthikeyan of the Congress Party was the Minister for Electricity for the State of Kerala, India. The so called consultancy agreement include the rates for various equipments to be purchased as part of the project. The consultancy agreements of the project were converted into fixed price contracts for the supply of machinery and technical services as part of the renovation at a cost of 67.94 million Canadian dollars (Rs 169.03 crores approx.) in February 1997. During this period Pinarai Vijayan was the Minister for Electricity for Kerala.

Computer and Auditor General of India (CAG, a government organization that audits and assists the state and central institutions on their accounts and accountability.) found that Lavalin was only a consultant intermediary and not the original equipment manufacturer and that the supply of goods and services was made by other firms at a much higher cost leading to excess expenditure on the project. According to the CAG, the absence of due professional care in negotiating the foreign loan proved to be a detrimental factor to the financial interests of the Board. The Board also could not ensure the quality of power plant renovation work in the absence of technology transfer and training of its engineers. Owing to various technical defects in the equipment, the generation of power could not be maintained even at the pre-renovation level and the Kerela Electricity Board had to spend on repairs.

According to the CAG, failure to exclude the fee for technical consultancy from fixed price contracts resulted in an avoidable payment of Rs 20.31 crores, and failure to negotiate and exclude the exposure fee from the loan agreement resulted in avoidable payment of Rs 9.48 crores and future liability of Rs 2.21 crores. In the opinion of the CAG, there was also an avoidable payment of Rs 1.20 crores as commitment fee despite there being committed but unavailed advance.

The CAG found that the Government did not receive Rs 89.32 crores out of the grant of Rs 98.30 crores that was promised for the Malabar Cancer Centre. On 16 January 2007, Kerala High Court ordered a CBI enquiry into the scandal.

On February 19, 2008, the CBI informed High court of Kerala that the investigation was progressing and said that former Electricity Ministers Pinarayi Vijayan and G. Karthikeyan would be examined at the appropriate time.

On 21 January 2009, the CBI filed a progress report on the investigation in the Kerala High Court. Pinarayi Vijayan had been named as the 9th accused in the case.

Kerala Ice Cream Parlour Sex Scandal

The ice cream parlour sex scandal is one of the long running sex scandals in Kerala state, South India. Many of the top political icons are considered to be involved in this scandal. This is an evolving case in Kerala for last decade. Major political figures who are facing criticism include P. K. Kunhalikutty and P. Sasi who was a former secretary and a close aide of E. K. Nayanar.

Kunhalikutty's allegedly involvement in the "Ice Cream Parlour Sex Scandal" was a major upset for the UDF government. LDF initiated many strikes and issues in this account. Kunhalikutty stepped down as minister in January 2005 following an opposition onslaught. The latest development in this case is the information made public by K. A. Rauf who is the co-brother and a former aid of Kunhalikutty. The latest claims by Rauf included bribing the Judiciary and the prime witness of the case Regina.It was a big issue in kerala politics Muslim league said it was raised just to destroy the party.

Housing Loan Scheme Scam of 2010

CBI alleged that the officers of various public sector banks and financial institutions received bribes from the private financial services company Money Matters, which acted as a mediator for corporate loans and other facilities from financial institutions. The bank officials sanctioned large-scale corporate loans to realty developers, overriding mandatory conditions for such approvals along with other irregularities.

The Central Bureau of investigation arrested number of high official from the several financial institutes in India in connection with the housing scam in November 24, 2010. Smith (2010) stated that findings are shocking where the head officers of several banks and financial institutes are involved in corporate corruption. Precisely, the banks and financial officials were from the public sectors including LIC, Bank of India, Central Bank of India and Punjab National Bank. However, ) stated that since the matter was related to the erosion of funds from the LIC housing and Finance Limited, event was named as the LIC housing and Finance Scandal. Lamont (2010) cited that the officers from the high rank including the secretary of LIC Investment, general managers, directors and deputy managers of banks were involved in taking out the funds from LIC in appropriate and unethical way. Smith (2010) said that these officials were acting as the middleman to provide the funds to the main parties and in return they were having hefty amount of funds from the real investors, insurers and other consumers. Smith (2010) regarded this as the distortion of the corporate governance system where the business ethics were neglected to sustain the core business activities of the public sector banking firm.

Meanwhile, Economic Times stated that the officials were charged with the exploiting of funds, looting, corrupting corporate loan process and manipulating and overriding with the regulations of the LIC Housing and Finance Limited in regard to the approvals and other rules and regulations. Nonetheless, The loans provided through this manner were estimated to be worth of 85 Billion Dollars, comes as the biggest scandal in the Housing Finance in Asia However, the stock price took a sharp dip soon after the event. Apparently, LICHF had a good run till September 2010 when it reached Rs.299 and the growth rate undoubtedly, received the appreciation by the investors and other shareholders. The stock recorded no significant changes thereafter but the appearance of corporate scandal shook the stock price chart and the price dip to Rupees 150 by the end of year 2010. At present the stock price is stands at around rupees 190 and gaining its momentum over a period of time but however, Lamont (2010) felt that the combination of factors that happened in the last quarter of FY10 were accountable for the sharp decline in the LIC Housing and Finance Share price. Reuters stated that LIC Housing and Finance is looking forward to raise the capital to the tune of Rupees 25000 Crores in 2011-12 through debt. Eventually, the technical experts believed that company is developing its core competencies and capabilities and undoubtedly, investors would revive the stock price and current Market changes and company’s development will be seen through the price momentum.

However, experts believed that the Housing and Finance Scandals by the top officials in LIC and other banking institutes will always stand to harm the future potential of such companies but however, the future and the endless opportunities lies in the hand of ultimate investors. Eventually, Online newspaper, Rediff quoted as saying that most of the brokers are taking up the stock of LICHF after the scam as related to the current project being performed by the company. Namely, IIFL, Aditya Birla, IL&FS are impressed by the current progress by the company and building up the stock ay higher rate.

Reuters stated that the Financial Budget introduced by the Indian Planning Commission had slightly adverse effects on the stock of banking, insurance, mortgages and other related sector in the industries. However, the company has been quoted as saying that they would include the margin between 2.8 to 3 % in relation to the rising interest rates and their effects on the share price. However, In response the scam, the Reserve Bank of India and other regulatory and financial bodies attempted to reform the housing finance sector by making several supervision and security measures in this regard. Eventually, the corporate scam destroyed the interest and confidence of investors and thus, the monetary and regulatory authorities must execute their task in relation to safeguarding the interests of investors.

Apparently, Smith (2010) stated that the Central Bureau of Investigation exposed the stock price dip to 18% of the prevailing market rate after the scam and other banks who were involved saw a decline between 5 to 15% during the time.

Hence, it was anticipated that investors believed in the core values and company’s relation with the investors and the stock changes occur in the short span of time but however, the stock is futuristic for the long term.

CBI's Economic Offences Wing (EOW) raided offices of the public sector banks and LIC Housing Finance in six cities (Mumbai, Delhi, Chennai, Jaipur, Kolkata and Jalandhar), to recover incriminating documents.

According to CBI, the companies to which the loans in question were given include:

• Lavasa Corp., a unit of Hindustan Construction Co.
• Oberoi Realty Ltd.
• Ashapura Minechem Ltd.
• Suzlon Energy Ltd.
• DB Realty Ltd., a part of the Dynamix Balwas Group
• Emaar MGF Land Ltd.
• Mantri Realty
• Kumar Developers Ltd.

The CBI EOW also suspected that the companies may have inflated their assets value and balance sheets in order to make themselves eligible for the loans.

According to CBI, an employee of Money Matters expressed his willingness to turn witness in the case.

Most firms, including BGR Energy and Oberoi Realty denied any role in the scam.

The scam was discovered shortly after the 2010 Commonwealth Games corruption controversy and the Adarsh Housing Society Mumbai scam. The investors were rattled as news of the arrests broke in Mumbai. The share of the LIC Housing Finance, Central Bank of India, Punjab National Bank, Bank of India, Money Matters Financial Services Ltd. as well as other banking and real-estate stock declined.

The Union finance ministry initially claimed that the case was a bribery incident, and not a large-scale scam. The CBI officials had indicated that the size of the scandal could be worth over Rs 1,000 crore, but the finance ministry officials claimed that the magnitude of the scandal was too insignificant to have an impact on the Indian financial sector.

The income-tax (IT) department decided to investigate the books of those involved in the scam, after receiving primary reports from CBI. However, many political analysts believe innocent bankers were implicated in this falsely created scam to defuse attention of the common man against the much larger & serious scams done by the ruling Indian government, notably of corrupt politicians like CWG minister Suresh Kalmadi & ex-telecom minister A Raja.

A R Antulay Cement Scam 1982

In 1982, A R Antulay resigned as Chief Minister of Maharashtra after the Bombay High Court convicted him of extortion on January 13, 1982. The court ruled that Antulay had illegally required Mumbai area builders to make donations to Indira Gandhi Pristhan trust, one of several trust funds he had established and controlled, in exchange for receiving more cement than the quota allotted to them by the Government

Natwar Singh Oil for Food Scandal

Natwar Singh was removed from the post on December 6, 2005 (though retaining a cabinet role as minister without portfolio) following a controversy over his alleged involvement in the United Nations Iraqi Oil for Food scandal. The Independent Inquiry Committee under Paul Volcker had reported on October 27, 2005 that he and his son Jagat Singh were non-contractual beneficiaries of the Oil for Food programme.

Allegedly, they, along with Jagat Singh's childhood friend Andaleeb Sehgal, were associated with a company called Hamdan Exports, which acted as an intermediary for illegal sales of oil to a Swiss firm named Masefield AG. In return, Masefield had to pay kickbacks, (termed "surcharges") partly to Saddam Hussein's regime and partly to Natwar Singh and others. It was alleged that such surcharges were Hussein's way of securing support from politicians around the world and that this influenced Natwar Singh to lobby against US policies in Iraq (in particular, US sanctions on Saddam Hussein). This controversy heated up when Anil Mathrani, then Indian Ambassador to Croatia, and a close aide to Natwar Singh alleged that Natwar Singh had used an official visit to Iraq to procure oil coupons for Jagat Singh from Saddam's regime.

This scandal represented a serious crisis for the ruling coalition. On March 26, 2006 it was reported that the Indian Enforcement Directorate (ED), investigating the money trail in the 'oil-for-food' scam, had finally tracked a sum of Rs 8 crore transferred from London-based NRI businessman Aditya Khanna's bank account to his own NRI account in a Delhi bank and later withdrawn from this account to be allegedly distributed among Indian beneficiaries of the scam.

In 2008, Natwar Singh resigned membership in the Congress Party after earlier having his membership suspended.