'Why worry about SFIO investigation'; HC asks KSIDC in Exalogic case

KOCHI: The High Court in Kerala took a dig at the Kerala State Industrial Development Corporation (KSIDC) asking the firm why it was concerned by the Serious Fraud Investigation Office (SFIO) investigation.

The court said in normal cases, the corporation should be relieved that an investigation is taking place. Justice Devan Ramachandran's bench considered the petition filed by KSIDC asking to stop the SFIO investigation.

Senior counsel CS Vaidyanathan, appearing for KSIDC, argued that the investigation into the money transfer between the two private companies is affecting the credibility and credit rating of KSIDC. “Prima facie it is clear that the investigation against them has no substance. Every document requested by SFIO was duly handed over.”

KSIDC informed the court about not receiving any response from CMRL when asked for the report payment to Exalogic. The court then asked KSIDC to produce the documents to prove KSIDC’s earlier request to CMRL. After seeking time in this regard, the petition was adjourned for hearing on the 26th of this month.

The PIL filed by Shaun George seeking SFIO intervention in the matter will also be considered on the 26th. CMRL's counsel requested that further proceedings in this petition be stopped as the SFIO has started an investigation, but the court refused.

The Central Government has informed on behalf of the Serious Fraud Investigation Office that further investigation is required against KSIDC. The documents provided need to be verified. The Center also pointed out that illegal transactions are causing losses to KSIDC, a public institution.

The central government also informed the court that the three-member committee appointed under the Companies Act to investigate the alleged transactions had submitted an interim report.

It was also argued in the court about the Satyam scam that unveiled the reality that even the independent directors may be held liable if found any irregularity with the company.

But CS Vaidyanathan argued that the alleged transactions were not in the accounts book and therefore KSIDC had no knowledge about the matter.