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Court orders criminal cases in Raj hotel sale

Hindustan Times logo Hindustan Times 16-09-2020 Dinesh Bothra
© Provided by Hindustan Times

Jodhpur: A special Central Bureau of Investigation (CBI) court in Jodhpur ordered the registration of criminal cases against former Union disinvestment minister Arun Shourie, former disinvestment secretary Pradeep Baijal and three other people on Wednesday in connection with a case of alleged corruption in the sale of a government-run hotel in 2002.

The special CBI judge, Pooran Kumar Sharma, also ordered that the hotel in question -- the Laxmi Vilas Palace Hotel in Udaipur -- be handed over to the state government. The hotel -- earlier run by the Indian Tourism Development Corporation -- was sold to the Bharat Hotels Limited, which now runs the Lalit group of hotels, in 2002.

The judge’s orders came while hearing a closure report by CBI in the case of alleged loss of Rs 244 crore to the government by the sale of the hotel. The CBI report said that there wasn’t evidence to launch prosecution against the accused in the disinvestment process.

But the court disagreed and even criticised the federal agency for presenting a closure report in the case.

“Prima facie, it appears that the then minister Arun Shourie and then secretary Pradeep Baijal misused their offices and caused a loss of Rs 244 crore to the central government in the deal," the court said.

“The CBI is a reputed agency of the country; closure report by it despite facts pointing towards criminality is a cause of concern," judge Sharma said .

The three other people accused in the case are Ashish Guha, then managing director of investment firm Lazard India Limited, Kantilal Karamsey Vikamsey, then head of valuation firm Kanti Karamsey & Co, and Jyotsna Suri, chairperson and managing director of Bharat Hotels Limited. The court ordered they be booked under section 120B (criminal conspiracy) and 420 (cheating) of the Indian Penal Code and section 13 (1) D of the Prevention of Corruption Act.

The court said that they should be summoned through arrest warrants. The date of the summons would be known once the warrants are issued.

None of the accused were available for comment despite attempts. They were not represented in the court by any lawyer.

The court directed the district collector of Udaipur to take over the hotel immediately.

“We have enforced the court’s order," said Udaipur collector Chetan Dewda. General manager of the hotel, Devendra Singh Parihar, said he was not authorised to talk to media.

The CBI registered first information report (FIR) on August 13, 2014 on the basis of a preliminary inquiry that alleged that Baijal abused his official position and entered into a criminal conspiracy in the disinvestment of Laxmi Vilas Palace Hotel.

According to the FIR, the hotel and land on which it was built was initially valued at Rs 252 crore. But it was finally disinvested for Rs 7.52 crore.

The CBI FIR said that Kantilal Karamsey Vikamsey re-evaluated the property and claimed it fell in red zone, where any construction is banned, and a lake and a high tension wire made the property unattractive.

But after its investigation into the FIR, the CBI filed a closure report before the court and said it didn’t have enough evidence to prosecute the accused.

“The CBI has not got any direct evidence to initiate prosecution against the accused," the CBI said in the closure report.

But the court did not accept this contention. “The unknown officers and private persons indulged in this conspiracy from 1999 to 2002 to cause loss of money to the government," the court said. “The value of the land was evaluated at Rs 45 per square yard. Even a spoon in the hotel would be costlier than that," the judge added.

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