HC calls for UTI-RIL records from CBI

Our Corporate Bureau

New Delhi, Aug 24: THE Delhi High Court has asked the Central Bureau of Investigation (CBI) to produce all records pertaining to Reliance Industries’ Rs 945-crore private placement of shares with Unit Trust of India (UTI) and other institutions, even as the premier agency told the court that its intervention in the case was not considered necessary at this stage.

The court has also asked CBI to reply whether an investigation into the case was stalled by the finance ministry in 1996. CBI has been asked to submit the records by September 29.

A division bench comprising Chief Justice Arijit Passayat and Justice DK Jain have directed CBI to file an affidavit in this regard after going through its earlier affidavit.

The court was hearing a public interest litigation (PIL) filed by Janata Party president Subramaniam Swamy against RIL.

In its affidavit to the court, CBI said it had sent a self-contained note to the finance ministry in May 1996, regarding alleged irregularities in placement of funds to the tune of Rs 945 crore by UTI, Life Insurance Corporation (LIC) and General Insurance Corporation (GIC) in Reliance equities.

CBI had sought finance ministry’s concurrence to investigate the matter further. The ministry, in its reply in December 1996, stated that “registration of a regular case for further investigation did not seem to be warranted”.

It also enclosed an audit report on Reliance investments made by UTI, the comments of UTI on the audit report, Securities & Exchange Board of India’s (Sebi) comments thereon and UTI, LIC and GIC’s response to the allegations made in the self-contained note.

According to CBI, it re-examined the information in the note in the light of finance ministry’s response and documents received with it. The matter was also taken up with Sebi and department of company affairs which “categorically informed that neither any Sebi guidelines had been violated nor had any violation of Companies Act taken place”. The chief vigilance officer of UTI was also requested to probe the role of UTI officials.CBI was informed that the investments in Reliance by UTI had been scrutinised by three independent auditors and all of them had stated that no adverse role of any UTI official had come to notice.

CBI has stated in its affidavit that the decision was taken at the highest level by the board of trustees after due process.

CBI also informed the court that its official YP Singh was not transferred out of CBI due to the UTI-Reliance case. He was repatriated to his parent cadre for different reasons.

The matter was adjudicated by the Central Administrative Tribunal, Mumbai and allegation of malafide against CBI and government were rejected. The writ petition filed against this decision is pending before the Mumbai High Court.