Former Chief Minister of Jammu and Kashmir, Omar Abdullah, was questioned by the Enforcement Directorate in Delhi on Thursday about a key property of the Jammu and Kashmir Bank Ltd purchased allegedly in violation of rules in 2010 (Pic. Courtesy ANI)
Former Chief Minister of Jammu and Kashmir, Omar Abdullah, was questioned by the Enforcement Directorate (ED) in Delhi on Thursday about a key property of the Jammu and Kashmir Bank Ltd (JKB) purchased allegedly in violation of rules and for an exorbitant price in 2010.
While the principal investigation lies with the Central Bureau of Investigation (CBI), ED’s questioning of Omar is an indication of some bank accounts and properties of the alleged beneficiaries being attached. According to a preliminary enquiry (PE) conducted by J&K Government’s Anti-Corruption Bureau (ACB), the 10-floor building at Mumbai’s Bandra Kurla Complex (BKC) was purchased when Omar was J&K’s Chief Minister.
The investigation reveals that the deal was struck with the property owner Akruti Gold BKC and token money of Rs 25 crore paid to the developer Vishal Techno Commerce Ltd when Haseeb Drabu was the Bank’s chairman. Subsequently a conveyance deed was registered on 18 September 2010 against a total sale consideration of Rs 180.57 crore when senior IAS officer and then Finance Secretary Sudhanshu Pandey was interim chairman.
Appointed in Mufti Mohammad Sayeed’s PDP-Congress government in 2003, Drabu was sacked by Omar’s NC-Congress government on 27 August 2010 after functioning as Chairman and Managing Director of JKB for over 5 years. The charge of Chairman and MD was subsequently held by then Finance Secretary Sudhanshu Pandey, who is currently Secretary Department of Food & Public Distribution in Government of India. Later Drabu joined the PDP and functioned as Finance Minister in Mufti Sayeed’s and Mehbooba Mufti’s PDP-BJP government.
After Farooq Abdullah and Mehbooba Mufti, Omar is J&K’s third former Chief who has been questioned by CBI or ED in a matter of alleged financial fraud. He has, however, maintained during his five-hour-long questioning that the Chief Minister was in no way in the know of or involved in the process of acquisition of the bank’s properties.
Later while speaking to the media, Omar said, "I joined the investigation. They have not blamed me (for anything). If they call me again, I will help them again. There are no allegations against me. It is a 10–12-year-old case. They called me to question regarding this case. I will cooperate with them, if called again as well".
In July 2021, J&K ACB diarised a written complaint and held the PE which led to registration of FIR No: 14/2021 Dated 10 July 2021. Since the PE indicated a J&K-Mumbai connection, the government on ACB’s request assigned the investigation to the CBI which filed FIR No: RC1232021A0010 Dated 11 November 2021 in Srinagar.
“ACB J&K has recommended transfer of the case to the CBI on the reasons that the case involves inter-State investigation and also expertise of financial/banking and real estate available with the CBI would be of immense help to establish a strong case against the accused”, Deputy Secretary to J&K Government, General Administration Department, wrote to Director CBI on 11 August 2021 with approval of the Lieutenant Governor.
According to the ACB’s PE, JKB had issued an advertisement seeking offers for acquisition of 20,000 square foot floor area for ‘integrated office premises’ at Bandra Kurla on 6 November 2008. Twenty-five builders submitted offers and eight of them were shortlisted. Spot inspection was conducted by the bank’s high- level committee on 13 December 2008. Ashapura Builders with their quoted rate of Rs 25,000 per sft figured as the lowest bidder.
On 28 July 2009, JKB received a letter from Ashapura Builders expressing willingness to offer 3rd floor of the building, measuring 30,000 sft, at Rs 22,500 per sft. The application was processed and submitted to the Chairman for his decision. “A committee was constituted with approval of chairman to take a view with regard to the offer received. The committee so constituted has done nothing in respect of offers received especially on the application of M/S Ashapura Builders”, reveals the PE.
Upon directions from JKB Corporate Headquarters in Srinagar, the bank’s Mumbai Zonal Head published another advertisement on 14 January 2010, seeking offers for office space of 25,000 to 30,000 sft and 15 single BHK and 10 double BHK flats as residential flats in or around Andheri. Twenty-three offers were received. M/S Ashapura Builders again offered the lowest rate of Rs 25,000 per sft.
JKB’s Board of Directors (BOD) held a meeting on 25 February 2010 in which the Director Estate Committee briefed about the site inspections of the shortlisted properties by the Estate Committee. Ignoring the lowest bid of M/S Ahapura Builders, the BOD accorded approval to the proposal of M/S Akruti Gold BKC who quoted Rs 26,000 per sft. It worked out to Rs 109 crore for the entire building and Rs 73 crore for the proposed 6 floors. The BOD decided that JKB should hold negotiations with M/S Akruti Gold for purchasing the entire building.
Rate of Rs 26,000 per sft was finalised and approved for 9 floors of Akruti Gold BKC property having chargeable area of 63,776 sft. “A letter of intent was signed with the builder and a token money of Rs 25 crore was paid to developer Vishal Techno Commerce Limited '', reads the PE. The BOD accorded approval to the acquisition vide B.R. No: 37 dated 15 June 2010. “Subsequently a conveyance deed in respect of property (Akruti Gold) at BKC Mumbai was registered on 18.09.2010 against a total sale consideration of Rs 180,57,05,200 including stamp duties, registration charges, property tax and maintenance charges etc”.
The PE has observed that there was already enough space for the bank’s all establishments in Mumbai and there was no requirement of purchasing any additional accommodation.
“The Zonal Office Mumbai, Branch Bandra Kurla and Treasury were already functioning in the Bank’s own buildings. The advertisements issued were for 20,000 sft and 20,000—30,000 sft respectively in response to which the rates offered by M/S Ashapura Builders were Rs 25,000 & Rs 22,000 per sft. However, in furtherance of a criminal conspiracy hatched among the officers/officials of J&K Bank and the owners of Akruti Gold BKC, to confer undue benefit upon the beneficiary owners and for personal pecuniary gains, officers/officials of J&K Bank approved purchase of 65,065 sft area at Rs 26,000 per sft on highly exorbitant consideration of Rs 180,57,05,200 in blatant disregard to the tendering process with consequent loss to the Bank exchequer”, says the ACB’s PE.
“By acting in this manner, the officers/officials of J&K Bank management, under a well-knit conspiracy with the promoter Directors of Akruti Gold, by abusing their official positions, purchased excess space at exorbitant rates in blatant violation of tendering process just to favour the Builders which caused a tentative loss of more than hundred crore to the bank exchequer”, reads the inquiry report accessed by India Narrative.
CBI is currently holding the investigation in coordination with ED.