NEW DELHI: The Union Cabinet on Thursday approved the appointment of a one-man Inquiry Authority, headed by the former Chief Justice of India, R.S. Pathak, to look into the Volcker Committee Report.

The report made references to the former External Affairs Minister, Natwar Singh, and the Congress as "non-contractual beneficiaries" in the U.N. oil-for-food programme in Iraq.

The notification relating to the setting up of the Authority and the terms of reference would be released on Friday.

After the Cabinet meeting, Finance Minister P. Chidambaram told presspersons that the Authority had been set up to establish the truth or otherwise of the unverified references in the Volcker Committee's report of allegations of payment of kickbacks to certain Indian entities and individuals.

Despite persistent queries, he declined to explain why an authority, and not a commission was being set up. "I do not want to go into legal technicalities now. ... The notification will be issued on Friday."

He said it would not make any difference. "There will be no difference in terms of the objectives to be achieved. The Authority is also being set up under the provisions of the Commission of Inquiries Act. It would be clothed with all necessary statutory powers."

To another question, he said the Enforcement Directorate was questioning Andaleeb Sehgal of Hamdan Exports and his friend, Vikas Dhar, in connection with the case. He denied that Jagat Singh, son of Mr. Natwar Singh, was being questioned.

Ministry's caution

The Ministry of Company Affairs said on Thursday that it had not undertaken any exercise to see whether there had been any violation of the Companies Act, 1956 by the Indian companies named in the Volcker Report.

Reacting to media reports that the Ministry was looking into the report, it said: "no such exercise has yet been initiated or contemplated by the Ministry with reference to the Volcker Committee Report. Minister Prem Chand Gupta had simply asked his officers to study the report and brief him on the contents and their implications."

He cautioned all concerned to be careful in their reactions and not distort the facts as it "may create unnecessary confusion in the minds of the Indian business community and others, which is wholly unwarranted," it said.

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