Probe Agency Files Money Laundering Case Against Sanjay Bhandari

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A charge sheet was filed by the ED in this case in June (Representational)

New Delhi:

The Enforcement Directorate has filed a money laundering case against on run defence consultant Sanjay Bhandari to probe kickbacks worth USD 4.99 million allegedly received by him from South Korean major Samsung Engineering Co Ltd (SECL) in 2009, officials said on Monday.

Bhandari’s firm was paid by SECL, in violation of rules, to influence government officials in awarding a Rs 6,744-crore contract for setting up a Dual Feed Cracker Unit in Gujarat to OPaL, a company promoted by some oil PSUs, including ONGC, they said.

OPaL, in turn, awarded the contract of the project to a consortium of SECL and Germany’s Linde for Rs 6875.11 crore, they said.

They said the central probe agency has filed an Enforcement Case Information Report (ECIR), equivalent to a police FIR, under the Prevention of Money Laundering Act (PMLA) to probe these dealings.

The agency took cognisance of a CBI FIR filed early this month against Bhandari and others in the case, they said.

This is the second money laundering case against Bhandari after he was booked by the Enforcement Directorate (ED) for alleged possession of undisclosed assets abroad and other charges in February, 2017.

A charge sheet was filed by the ED in this case in June.

The central probe agency said Bhandari had not cooperated with it in the probe in the first case and had run away from the country and was last stated to be in the UK or a nearby country.

In the latest case, the CBI has charged Bhandari for allegedly receiving kickbacks worth USD 4.99 million from SECL in 2009 to influence government officials in awarding the Rs 6,744-crore contract to ONGC Petro Additions Ltd (OPaL), a company promoted by PSUs like ONGC, GAIL and Gujarat State Petroleum Corporation.

The allegation is that the Dual Feed Cracker Unit (DFCU), the CBI had said, which was to be set up at Dahej Petrochemical Complex in Gujarat, was awarded in favour of SECL in 2009 and advance payments were released to it from ONGC in contravention of Central Vigilance Commission (CVC) guidelines.

In its FIR, the CBI has also named the then Senior Manager of SECL Hong Namkoong, UK-based Foster Wheeler Energy Ltd, and Bhandari’s UAE-based company Santech International FZC, besides unidentified officials of ONGC and OPaL, for alleged corruption in the award of the contract.

The tender for the DFCU project was floated on April 20, 2007 for which two consortiums — Germany’s Linde and Korean SECL, and USA-based Shaw Stone and Webster and Indian Larsen & Toubro — submitted their bids.

Linde and SECL consortium won the contract at their quoted “lump sum price of Rs 6875.11 crore” on the basis of higher Net Present Value (NPV).

NPV of Linde and SECL was calculated to be around Rs 4,160 crore while that of Shawstone and Webster and L&T around Rs 3,918 crore.

The tender committee came to the conclusion that NPV of Linde and SECL was higher and lump sum prices were 7.75 per cent lower than the competing consortium.

The other consortium challenged the decision but the objection was turned down and the contract was awarded to Linde and SECL consortium for a lump sum price of over Rs 6,744 crore on February 10, 2009.

The agreement signed between the consortium and ONGC and OPaL had an integrity pact which said no agent or consultant was to be engaged and no commission or fee could be paid against the contract in India or abroad, the CBI had said.

The CAG had also raised objections to it and the project was not completed even two years after the deadline of August 2012.

The CBI has alleged that Bhandari in its Income Tax returns did not disclose maintenance of foreign bank accounts in the name of Santech International and also the receipt of USD 4.99 million.

Bhandari’s case first came to light after the Income Tax department conducted searches against him in April, 2016 and recovered certain “sensitive” official defence documents from his premises.

The tax department had booked him under criminal charges of the anti-black money law.

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Tagged Enforcement Directorate, Sanjay Bhandari

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