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ED doubts Shravan Gupta's version on AgustaWestland

Sadiq Naqvi | Updated on: 10 February 2017, 1:50 IST

The Enforcement Directorate (ED) is not convinced by the responses of Shravan Gupta, the promoter of Emaar, a joint venture of Emaar MGF. On Wednesday evening, Gupta was questioned at the Delhi zone office of the agency.

He was asked about the inflow of funds from Mauritius. The questioning comes after a complaint by BJP MP Kirit Somaiya, who asserted that there was a need to probe the links of Kanishka Singh, an old Rahul Gandhi aide, whose extended family owns Emaar and Guido Haschke, the middleman in the eye of storm in the infamous AgustaWestland episode.

While Singh has not yet been summoned by the agency, officials didn't rule out the possiblity. "We may summon him if there is a need," a source in the agency said.

Singh, however, has denied any links with Emaar and said he has been estranged with Rajiv Gupta's family (Emaar MGF). Thought related to him, he fell out in 2005 when Gupta propounded a will of Ved Prakash Gupta, which he believed is a case of forgery. The matter is sub judice.

"Gupta claims that the appointment of Gautam Khaitan and Guido Haschke to the board of Emaar MGF Land Ltd in 2009 was purely for business reasons," a source said, adding that nobody in the agency bought the theory.

Gupta is said to have told the agency that both the middlemen being investigated were brought in because one of the directors resigned. The vacancy needed to be filled as the company wanted to bring out an initial public offering (IPO) at that point.

According to sources, Gupta also told the agency that he was friends with Khaitan and that's how he was introduced to Hachke, who was appointed to the board along with other independent directors. This was "due to the statutory requirement of having an equal number of independent directors on the board (in our case six) to be eligible for a public listing," Emaar had said earlier.

Records from the Registrar of Companies show that Khaitan was appointed to the board on 3 September, 2009. Haschke joined a few weeks later on 25 September. But, surprisingly, he quit on 7 December.

Interestingly, the ED raided Emaar's office and the residences of two of its directors on 2 December, 2009, for suspected violation of Foreign Exchange Management Act. "There is something fishy in the way he joined and then resigned days after the raid," a source points out. "You don't just appoint anyone on the board."

BJP gunning for Singh

This is not the first time that Bharatiya Janata Party (BJP) is gunning for Singh and his role in Emaar. Back in 2010, Union Minister Nitin Gadkari, alleged MGF, a beneficiary of Commonwealth Games contracts, was owned by Kanishka Singh.

"The company appointed a sub-contractor illegally and caused huge losses to the government by using substandard construction material for CWG flats," he had claimed. Gadkari had also questioned the bailout package to Emaar MGF and said: "at whose instance did the Delhi Development Authority (DDA) pay a bailout package for international zone? The government has invoked Emaar MGF's bank guarantee, but it's an eyewash, as the government does not wish to take action against the company".

In 2012, the CBI started probing DDA's Rs 728.89 crore bailout package to the realty major. The agency did not respond to requests on the status of the probe in the case.

Even then, the group had denied any links with Singh. "We would further like to state that Shri Kanishka Singh has no direct or indirect business interest, including as a shareholder and/or promoter in Emaar MGF or Commonwealth Games Residential Village," the company said.

Gupta's murky past

Gupta has a chequered past when it comes to financial dealings. Known for throwing parties, with guests such as Robert Vadra, Gupta has had several run-ins with the agencies.

His name came up in the black money list and the Income-Tax Department said he did not file the income tax return of $1.5 million that he held in an HSBC account in 2006. The Court had listed him as an accused in 2015 after taking cognisance of the IT departments complaint for not disclosing his income. Gupta had deposited the tax voluntarily in 2011 only after his name came up in the HSBC list.

In October 2007, in what was suspected to be an insider job, one floor at New Delhi's Mayur Bhawan, which housed the offices of the directorate-general of intelligence of the finance ministry, was gutted in a fire. The new outfit was set up by the finance minister just six months before the fire. The blaze destroyed most documents seized in raids at Emaar, which found it concealing an income of more than Rs 230 crore.

The CBI also investigated him for his role in the Emaar township scam in Andhra Pradesh. The agency in its chargesheet, claimed that Emaar MGF Land Ltd under Chief Executive Srikant Joshi and Managing Director Gupta, did not fix the price of the plots according to the market rate and that some of the plots were blocked through fictitious companies so that they could be sold at a premium.

Edited by Sahil Bhalla

First published: 5 May 2016, 3:58 IST