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Rediff.com  » News » Will ED's Rs 863 crore seizure help Jagan in some way?

Will ED's Rs 863 crore seizure help Jagan in some way?

March 06, 2014 12:46 IST

As Jagan's property attachment came on the day the poll dates were announced, the YSR chief and his supporters refuse to buy the Enforcement Directorate’s claim that it was a mere coincidence. Vicky Nanjappa reports.

The day the Election Commission of India announced the dates for the upcoming Lok Sabha elections, the Enforcement Directorate, in probably one of the biggest seizures, attached the property of YSR Congress chief Jagan Mohan Reddy, amounting to a whopping Rs 863 crore.

The attachment was made in connection with the Vadarevu and Nizampatnam Industrial Corridor, otherwise known as the VANPIC case which is being investigated by the Central Bureau of Investigation.

The attached properties are said to be held by Jagan and his group of companies. Under the scanner are the Carmel Asia Holdings Private Limited and the Jagathi Publications Limited. Giving a break-up of the same, sources say the properties attached comprise plant and machinery, shares and fixed deposits. The ED also attached the properties of industrialist Nimmagadda Prasad, which include G2 Corporate Services, Alpha Villas, Alpha Avenues, Gilchrist Investment, Beta Avenues Private Limited and Suguni Constructions.

Sources say that fixed deposits worth Rs 4.14 crore belonging to Jagathi Publications Limited, shares worth Rs 100.44 crore belonging to Indira Television, property worth Rs 11 crore and plant and machinery worth Rs 365.45 crore have been attached.

Apart from the shares of the companies, the ED also attached shares and land held individually by the accused. The remaining properties which make up the Rs 863 crore attachment, belong to Prasad and other accused.

According to the chargesheet filed by the CBI, Jagan and the other accused had allegedly cheated, committed fraud and falsified accounts.

The case involves the Vadarevu and Nizampatnam Industrial Corridor which is an industrial park spread over 13,000 acres located between the Guntur and Prakasam districts in Andhra Pradesh. Apart from the 4,000 acres that was acquired for the port development, other land was acquired from the local farmers as well.

The project was estimated at Rs 1,426 crore.

In this regard, a company called VANPIC projects was started by Prasad and the RAK group. The allegation is that large tracts of land were allotted to Prasad and RAK by the government under the late Andhra chief minister Dr Y S Rajasekhara Reddy.

The CBI alleged that quid pro quo investments, amounting to Rs 854 crore, were made by Prasad, and that this amount was invested illegally into Jagan’s companies in exchange for large tracts of land allotted by the government at YSR’s insistence.

The chargesheet also states that Prasad paid illegal gratification of Rs 30 crore to Jagan, apart from the investments in the latter’ company. It alleges that in exchange for this money, Prasad was awarded by the government the development work of two sea ports and an industrial corridor under the Vanpic project.

The chargesheet alleges that various concessions were given to the project, which included allotment of land, alleged exemptions from levy of stamp duty, registration charges and seigniorage (the difference between the value of currency and the cost of producing it) fee. The CBI states that there was illegal gain of up to Rs 1,426.17 crore in terms of land acquisition and as a quid pro quo, Rs 854 crore was paid to Jagan and his companies.

Jagan was arrested and later released on bail. The question now is if this seizure will change anything for him, as he readies to face his biggest election in another month. Strangely, Jagan has made all the CBI cases against him into an election plank and speaks about the vindictive politics against him. He questions the timing of the property attachment.

Political observers from Andhra Pradesh say that strangely this case would help him for the moment. His claim that the Congress has been vindictive towards him has further been strengthened with the latest property attachment. Although the ED says it was a mere coincidence that the date of attachment clashed with the announcement of election dates, Jagan and his supporters are not buying it.

Whatever the merits of the case may be, there is a general perception among Jagan and his voters that he has been targeted by the Congress.

Interesting, the Telugu Desam Party alleges that Jagan and the Congress are hand in glove. They have been charging him with entering into an underhand deal with the Congress to secure his release. This allegation has damaged his image to a small extent and the attachment may just as well help him shake off that perception.

Political observers say that he built the party on the basis of the humiliation meted out to him by the Gandhi family. This has helped him emerge as a significant force in Seemandhra. Ever since he has been accused of striking an underhand deal with the Congress, he has found it hard to change that image in certain sections.

The latest development, of attaching his property, will only help him change that perception, the political observers also feel.

Vicky Nanjappa