India Cements chief seeks more time to answer CBI in Jagan case

Srinivasan, also Board of Control for Cricket in India?s president, is accused of putting money in MP?s firms to get favours from YSR government

N Srinivasan, the Chennai-based India Cements vice-chairman and managing director, has been summoned by the Central Bureau of Investigation (CBI) for questioning regarding deals involving alleged exchanges of official favours with Y S Jagan Mohan Reddy, the Lok Sabha member currently in judicial custody in connection with a much-reported disproportionate assets case.

India Cements had invested about Rs 140 crore in the companies of Jagan, as the member representing Kadapa, Andhra, in the Lok Sabha is known. This includes an investment of Rs 40 crore in Jagathi Publications, which runs the Telugu newspaper Sakshi, and Rs 100.3 crore in other firms, including Bharathi Cements.

These investments, believes CBI, were made in return for allocation of water and extension of lease over a piece of government land to the company by the state government when Jagan’s father, the late Y S Rajasekhara Reddy, was chief minister.

Asks for more time
Srinivasan is also president of the Board of Control for Cricket in India. A senior CBI official said Srinivasan had sought some time to appear before the probe team. “We are considering his request,” the official told Business Standard, without elaborating on the extra time sought by the India Cements MD or when he’d called for the questioning.

Srinivasan did not respond to calls made to his mobile phone, for comments on the allegations. However, India Cements executive president T S Raghupathy, in an earlier response to queries from Business Standard, said: “There was absolutely no quid pro quo (a favour for a favour) at all. Water allocation towards expansion of our plants was perfectly in line with the AP Industrial Policy, to promote industrial development in the state."

Further, in a statement sent to this correspondent on Friday, Raghupathy said, “We have received a notice in the context of allocation of water towards expansion of capacity of two of our plants in Andhra Pradesh. Our senior officials have already met officials of the department in the past and have submitted all the required information sought by them. We are confident that the matter will be resolved at the earliest, since water allocation to our units was as per the Industrial Policy of the AP government.”

Charges so far

In a remand report filed on May 28 in the court trying the case, the day it had produced Jagan before the judge, CBI had prominently mentioned the investments made in Jagan's companies by India Cements and the Hyderabad-based Penna Cement Industries Ltd, while referring to various government orders issued on allocation of water, land and mining leases to both companies.

Taking exception to linking water allocation with quid pro quo allegations, a senior official in the state government said, “The government had allocated water to many industrial projects, along with India Cements, for the development of industry in the state. Such decisions cannot automatically be construed as a quid pro quo arrangement.” The official, however, refused to be named.

Sources in the government said Srinivasan and Rajasekhara Reddy had been friends long before the latter became chief minister in 2004 (he died in 2009, in an aircrash, soon after his re-election).

The CBI has so far filed three charge sheets in the Jagan case, based on the premise that all those who’d invested into his companies had done so for the benefits they received from the state government during his father’s regime. CBI named 74 companies and individuals, including unknown public servants and unknown ‘others’ in its First Information Report in August last year. The FIR also named Dalmia Cements and Bharathi Cements, among other companies. Besides Jagan, it has so far arrested Matrix Laboratories’ founder, Nimmagadda Prasad, bureaucrat Brahmananda Reddy and former minister M Venkataramana in connection with the case.

CBI sources said at present, apart from Srinivasan, no other company head had been summoned for questioning.

The enforcement directorate has also been probing the case, based on the information gathered so far by CBI, besides independently verifying the details with some companies, including Hetero Drugs and Aurobindo Pharma, both of which were named in the first charge sheet.