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HUDCO scam: Ministry told to register cases

Legal Correspondent

New Delhi: The Supreme Court on Tuesday ordered that cases be registered against those recommended by the Central Vigilance Commission (CVC) in the case of alleged sanction of over Rs. 14,500 crore as loans by the Housing and Urban Development Corporation when Ananth Kumar was Urban Development Minister .

A three-Judge Bench, comprising Chief Justice K.G. Balakrishnan, Justices R.V. Raveendran and Dalveer Bhandari, gave the direction to the Union Urban Development Ministry after it was brought to the court’s notice that the Ministry was sitting over the CVC’s recommendations made in March 2006 on specific allegation of misuse of HUDCO funds.

Passing an interim direction on a petition filed by the Centre for Public Interest Litigation, the Bench also asked HUDCO to proceed with departmental action against those officials indicted by the CVC. The Bench asked the Ministry to file an action taken report and objections of HUDCO and others on the CVC’s recommendations in eight weeks for further directions.

Additional Solicitor-General Vikas Singh said the Government could not proceed further, as the matter was with the court.

He sought a formal direction to initiate action on the basis of the CVC report.

When the Bench asked whether the loan amounts were recovered, he said that as the loans were given mostly to State Governments and State Government institutions, most of the funds were recovered.

Counsel Prashant Bhushan alleged mala fide and arbitrary use of power in sanction of loans.

The CVC probed some cases and found irregularities. Three part-time HUDCO directors sanctioned loans amounting to Rs. 5,300 crore to 50 corporate houses in a day in the absence of a single permanent director.

The petitioner submitted that it wanted to bring to the court’s notice the huge loss to the exchequer by the mala fide and arbitrary use of power and sanction of loans by HUDCO.

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