The case against Chandrababu Naidu
Chandrababu Naidu is a worried man today. As the Central Bureau of Investigation readies itself to start a probe against Naidu in connection with the disproportionate assets against him, the man himself is exploring legal options and plans on challenging the probe in the Supreme Court of India.
The Andhra Pradesh High Court had ordered a probe by the CBI against him yesterday based on a petition filed by wife of Late Dr Y S Rajasekara Reddy. Naidu however has a tough task ahead of him in case the CBI starts its questioning. More importantly this order has thrown the battle in the open between Jagan Mohan Reddy and Naidu who have been at logger heads trying to expose each other.
The petition against Naidu delves into various details regarding the manner in which he alleged made his money. It is alleged that he comes from a lower middle class family from Chittoor district and it is stated that he entered into politics immediately after he completed his college. Hence there is no real record to show the income he had earned as his only source of income was his political career.
Terming him as the biggest betrayer for overthrowing his father in law, N T Rama Rao out of power, the petition against him states that he went on to earn riches through illegal means.
As per his own declaration he has inherited 2 Acres of agricultural land from his ancestral property by virtue of family partition before 1986 situated in his native village of Naravaripalle in Chittoor District. In an affidavit that was filed by after his family partitioned the property in 1986, it is averred by him that he sold his share of the land and bought lands in Nindali and Vakhyam villages of Nellore, from which his income was declared by him to be Rs.36,000 per annum.
The spree of amassing property by him appears to have commenced in Nellore District. He purchased 65 acres of agricultural land through his family members at a low rate of about Rs.1000 per acre in 1985. Soon thereafter, a further 250 acres were purchased benami by him.
The sources of funds for the initial 65 acres, and the latter 250 acres are the same, The entire area of 315 acres, in a single stretch encircled by a single farm compound with a fence that runs 12 kilometers in one long stretch.
On 25.08.2001, 4 transactions of large lands in these tracts took place involving Naidu and his son Lokesh, of which were gifts, and 2 were sales. Such a large number of transactions to and fro are clearly suspicious and lend confirmation to the fact that benami transactions were abounding.
As Chief Minister of the State,.Naidu made the declaration of his assets in 1999, it showed the value of about Rs.7.83 crores, a massive and inexplicable leap, keeping in view that his agricultural income had been declared only 10 years earlier as being Rs.36,000 per annum, and his income as an MLA was Rs.650/- per month and as Director of Heritage Foods was Rs.20,000/- per month. The acquisitions in property, which is arithmetically a few times over and above the earlier possessions, in the shortest
possible span of business time and equal time spent in political pursuits by the family, clearly indicate that the sources of income which enabled such acquisition of assets are clearly illegitimate and defy an alibi of natural course of events. The possessions of the family continue earned and held during the period of time, continue the line adopted hitherto.
In addition to this the CBI would also probe the benami transaction which was allegedly undertaken in the name of his mother apart from the various properties that are found in the name of his wife.
Investigation also needs to be carried out as far as Naidu’s mother Ammanamma’s transactions are concerned. Admittedly, the only property that she inherited was 2 acres from Naidu’s maternal and parents in Kuppam village. However, in 2000, she purchased 5 acres of land in Sy. No. 59 of Madinaguda Village of Hyderabad, from one Jasti Panduranga Vittal near Hitec City for Rs.40 lakhs and also a plot of 1,135 sq.yds. in the upmarket Banjara Hills area ofHyderabadfor Rs. 35 lakhs.
Other investments and assets of. Naidu and his family
On 19-10-1994, at the time of publication of prospectus of Heritage Foods India Ltd., Naidu as Managing Director has declared that he is not associated with any industry or business activity. But at that time, Naidu promoted M/s. Bhuvaneswari Carbides and Chemicals Pvt. Ltd., and
Bhuvaneswari Carbides and Alloys Pvt. Ltd., Both these units have borrowed from the banks and financial institutions, this fact was concealed in the prospectus deliberately.
It is pertinent to note that the investment made by Bhuvaneswari (wife) and Lokesh in the year 1999-2000 continued ill today in M/s. A 2 Z E multisoft Pvt.Ltd later changed the name as M/s Bizpro Technologies Pvt.Ltd, has not been declared in statement of assets and liabilities submitted to the Election Commission of India and State Legislature of Andhra Pradesh, a perjury liable for prosecution.
It is a mystery as to how.Chandrababu Naidu could promote a posh Three Star hotel in the most expensive area of Tirupati immediately after joining TDP in 1983. Nobody knows how he could mobilize the equity. He later sold this property to another TDP functionary, who was later made Kadapa ZP Chairman.
Rama Agricultural Farms
In 1989, a family firm called Rama Agricultural Farms consisting of Naidu’s mother, wife, son and a relative of them named P.Dasaiah Naidu purchased 3.276 acres of land in Kondapur, at a distance of only half a kilometer from Hitec City, for Rs. 1,00,000 at a rate of Rs.30,487 per acre. The sources of these funds remain unknown.
In 1996, an announcement is made by the Government headed by Naidu that an Infotech park called Hitec Citywould be established in the area abutting Kondapur. With this announcement, the value of the land held by Rama Agricultural Farms multiplies, providing substantial pecuniary benefit to the holders of the land.
On 4.4.1998, a company named Dr.Reddy’s Laboratories gets a sales tax deferment of Rs.25 crores for 14 years from the State Government headed by Naidu. This itself is questionable as such exemption is given only to a new industry/Unit. Dr.Reddy’s was founded in 1984, and is an established, listed company on both the NSE and the NYSE with revenues of $1.67 billion.
Naidu who was the pivotal policy maker of the State when he was the Chief Minister selectively leaked the policy formulations of the State in advance for the benefit of individuals and private entities who are related to him. The site and location of infrastructural projects envisaged or potential sites for such development was leaked out to the firms and entities owned and promoted by Ramoji Rao, Maganti Murali Mohan of Jayabheri Properties and the location and the extents of lands owned by the above named individuals/entitites and several others are the direct evidences in this regard. All such favours need to be examined and misuse of power amounting to loss of hundreds of crores of rupees to the innocent farmers and land owners ought to be suitably redressed.
Krishna Godavari (KG)Basin
The Krishna-Godavari basin is home to one of the most lucrative gas deposits in the world, as was discovered in 2002, and estimated to be almost 40 times that of the Bombay High basin. While the basin is located in the State ofAndhra Pradesh, the Government under Naidu chose to turn an obliging blind eye to its rights to the discovery on its soil, while allowing Naidu’s close associate Ramoji Rao to be the vehicle of the quid pro quo. In fact, there was also a note/letter to Naidu by the senior officers of the Government cautioning him that the State ofAP should also bid for the gas by forming a company like Gujarat had done. This piece of advice was wholly ignored by Naidu. In the process of exploring gas reserves in KG basin, Reliance industries indulged in many violations by hindering fishermen and polluting large extent of waters which caused unaccountable damage to environment and marine life.
Ramoji Rao’s company Margadarsi Financiers had fallen on hard times in the year 2007 when its irregularities and violations became public. Subsequently a committee of enquiry was constituted by Govt. of AP which revealed that Rs.2,600 crores of money was collected from public by violating Reserve Bank of Indianorms and regulations and it was declared that it was impossible for the company to repay its several depositors.
Despite the fact that almost all of Rao’s companies were in severe financial difficulties, Rao surprisingly offered through the news media to repay the full amount of Rs.2600 crores due to the depositors. This was followed by an assurance by him to thisHon’ble Courtfollowing which the amount due was repaid. A large portion of amount of so called deposits accounting to nearly Rs.275 Cr was declared as unclaimed initially.
In consideration for the favour done by the Respondent No. 8 in allowing the State’s K.G.Basin claim to be brushed under the carpet, the Reliance group facilitated the payout of Ramoji Rao’s debts to his depositors. This was carried out through known associates and friends of Mukesh Ambani.
Two of these known associates of Ambani and the Reliance Group are Nimesh Kampani and Vinay Chajlani.
Kampani extended himself in ensuring that Ramoji Rao would be bailed out. Within a short span of 37 days between December 2007 and January 2008, six “shell companies” were floated on three addresses, which are shown as Sriram Mills Compound, Worli, which is the official address
of Reliance Industries Limited. Reliance diverted Rs.2604 crores of its shareholders money through the shell companies to Ms.Kampani’s Equator Trading India Limited and.Chajlani’s Anu Trading.
The Shamshabad Airport
Between 1997 to 2001, in Palmakole village just adjoining Shamshabad, Margadarsi Chit fund private limited (a company in which Ramoji Rao and his family members were partners), along with many of Ramoji Rao’s employees with as low income as Rs.10,000/- p.m. bought a huge extent of 360 acres of land, when the market value was just Rs.50,000/-. As agricultural land ceiling was in existence, it was not possible for a single individual to hold large tracts of this land. Rao bankrolled the transactions entered into by his employees in order to facilitate this single piece of land to be transferred.
The fact that this land was purchased at ten times its market price ought to have been enough to arouse the suspicion of the authorities. Shortly after the purchase, Naidu directed the Government to grant permissions to the benami holders to convert their land to non-agricultural purposes, thereby avoiding the application of the ceiling law in regard to agricultural holdings.
Immediate upon conversion, all the various pieces of land were sold to Ramoji Rao at almost the same price1. For example, there were as many as 10 transactions in the name of Kolli Bapineedu Choudhary (now Vice President of Ramoji Film City), but not a single land stands in his name now.
In 1996, one. Maganti Murali Mohan of Jayabheri Properties / MM Financiers purchased 2.34 acres in thevillageofGachchibowli. These purchases were made for a total consideration of Rs.10 lakh. Murali Mohan is a close friend and associate of Naidu, who was then the Chief Minister of the State. Shortly thereafter, Naidu announced the Hitec City Project, which was to be coincidentally located in the villages of Kondapur, Gachchibowli and Madhapur.
Immediately thereafter, the prices of the lands in those villages rose dramatically, which was taken advantage by Murali Mohan who entered into several Development Agreements (8 projects) between 1996 and 1997 aroundHitecCity. Naidu showcaused the internationally reputed IT/Software/ ITES companies by allotting approximately 1/3rd of 645 Acres in Sy.No.65 of Madhapur area fuelling escalation in real estate prices and grabbed the rest of 2/3rd land through a slew of fictitious / benami paper companies at his behest. The very fact that most of these companies were Non IT/ software objective based companies and very few of them just start up Software companies incorporated with the sole intention of getting the land and other tax benefits from Government of Andhra Pradesh lends credence to the fact that Naidu benefited from the same. In all these allotments, Naidu either received illegal gratification in the form of cash or end beneficiary through Maganti Murali Mohan and others. For instance, companies floated by one Sri.Valluripalli Nagarjun in several names like Valluripalli Agrotech and Arjun Computers and Software got the lands from the government agencies for throw away prices. After getting allotment, some of the said companies transferred the lands to Murali Mohan and his group companies.