HYDERABAD: The Anti-Corruption Bureau (ACB) has started the ball rolling in the investigation of the Formula-E race case.
The probe agency on Wednesday recorded the statement of Municipal Administration and Urban Development Principal Secretary Dana Kishore, who is the complainant in the case.
The official reportedly gave a detailed account of how the financial irregularities that took place in the release of Rs 55 crore in foreign exchange to a company based out of the UK for the conduct of season 11 of the Formula-E race in Hyderabad.
The recording of the statement assumes significance since BRS working president and former municipal administration minister K T Rama Rao figures as the Accused No 1 in the case.
The ACB team recorded the statement for over seven hours, which covered the entire gamut of the developments till October 23, related to conducting the Formula E Race.
ACB sources said that Dana Kishore gave a graphic account of the violations that occurred while the HMDA transferred Rs 55 crore to Formula-E Organisation (FEO) from its Indian Overseas Bank (IOB) Himayatnagar branch in Hyderabad.
The sources said that the ACB had inquired as to who had initiated the first and second agreements and why the sponsor stepped back for conducting the Formula-E race in Hyderabad.
ACB collected documents in Formula-E Race case
The ACB had collected all the documents from the possession of the HMDA and MAUD related to the Formula E Race case, the sources said. They included the HMDA bank account statement as well as the correspondence between the MAUD principal secretary and HMDA commissioner and the chief engineer’s office.
Dana Kishore reportedly explained how RBI rules were violated and how no cabinet approval was taken for transferring the funds.
Dana Kishore is understood to have told the ACB that the HMDA cannot transfer any amount above Rs 10 crore and, if it has to release more, HMDA board has to pass a resolution and a copy of it should be sent to the MAUD for its approval. But in the case of the release of Rs 55 crore, the rules were not followed and the amount was transferred in two tranches to the account of a foreign company.
Moreover, the officers who served as HMDA commissioner and MAUD principal secretary, and the chief engineer had even failed to communicate with the Finance department or the Cabinet about the transfer.
Meanwhile, the sources stated that the then MAUD principal secretary Arvind Kumar had transferred the amount based on the mobile text message from the then minister K T Rama Rao. The MAUD did not even run a note file to the Cabinet for approval before the amount was transferred.
Dana Kisnore said that the Income Tax department had imposed a fine Rs 8 crore for violation of the norms in regard to the transfer of funds to the foreign company.
Based on Dana Kishore’s statement, the ACB has decided to send notices to A1 KTR, A2 Arvind Kumar and A3 BLN Reddy in the next few days.
The source stated that the ACB is likely to call Arvind Kumar first due to Rama Rao’s petition which is expected to come up before the Telangana High Court on December 27.
The ACB will decide on the next course of action after the HC gives its directions. The court has ordered the ACB not to arrest Rama Rao till December 30.
According to the sources, Arvind Kumar approached the Anti-Corruption Bureau officials offering to give a statement voluntarily on the transfer of funds, but the probe agency asked him to appear before them when asked.