The ‘scam’ involves a staggering sum of Rs 371 crore of government funds.
BENGALURU
In a significant development, former Chief Minister of Andhra Pradesh, Chandrababu Naidu, was arrested by the Criminal Investigation Department (CID) police in Nandyala on Saturday in connection with the Skill Development Corporation scam. Naidu, referred to as A1 in the case, is facing allegations of corruption and misleading the cabinet in a scam that has rocked the state.
The Skill Development Corporation scam, which involves a staggering sum of Rs 371 crore of government funds, has sent shockwaves throughout the region. The allegations against Naidu and others involved in the case include manipulating contracts, misappropriating public money, and orchestrating a fraudulent scheme under the guise of skill development corporation.
Government agencies such as GST, Intelligence, IT, ED, SEBI, among others, have all conducted thorough investigations into this scam. The authorities have reportedly traced money trail leading to tax havens abroad. It is said that the alleged scandal came to light two months after Chandrababu Naidu assumed power in June 2014. The project in question had a total cost of Rs 3,356 crore, with the government contributing 10%, while Siemens committed to 90% of the funding.
On its part, Siemens conducted an internal inquiry and provided a statement under Section 164 of the Criminal Procedure Code (CrPC) before a magistrate. Siemens emphasized that the company had no role in the Joint Venture (JVO) or the Memorandum of Understanding (MoU) issued by the government.
One of the central issues in this case is the manner in which a note from Skill Development, showing the estimated cost as a Detailed Project Report (DPR), was presented to the cabinet, bypassing established government procedures. This irregularity, combined with the swift approval and release of funds, has raised serious questions regarding adherence to rules, regulations, and due process. Furthermore, the contract and government orders appear to be at odds, as funds were released without a clear contractual basis. Allegations suggest that Chandrababu Naidu gave orders for the immediate release of funds, even when objections were raised by finance department officials. Key officials within the government, including the Finance Principal Secretary and the Chief Secretary, have reportedly played a role in facilitating the release of funds. However, the whereabouts of these funds remain unknown. It has also come to light that over 70 transactions involving this money occurred through shell companies. A whistleblower had previously reported this skill development scam to the Anti-Corruption Bureau (ACB) in the state. Additionally, a government whistleblower issued a similar warning in June 2018. Unfortunately, initial investigations into these claims were set aside.
In a troubling twist, notefiles related to the project were allegedly destroyed when these investigations commenced. Further complicating matters, companies such as PVSP/Skiller and DesignTech, which played a significant role in the scam, have claimed Cenvat without paying service tax. Suspicion arose when GST officials noticed irregularities in the company’s transactions, which were eventually revealed to involve money transfers through hawala channels as early as 2017.