ED files charge sheet in Rs 3.54 crore payment fraud in PHE dept

Srinagar, Oct 17 The Enforcement Directorate's (ED) zonal office in Jammu and Kashmir's Srinagar said on Friday that it has filed a prosecution complaint in the court in connection with the Rs 3.54 crore payment fraud in the Public Health Engineering Department.

A press statement by the ED's Srinagar Zonal office said, "The ED Srinagar Zonal Office has filed a prosecution complaint before the Special PMLA Court in the city against Ghulam Mohammad Bhat, the then Chief Engineer of Jammu and Kashmir's Public Health Engineering Department (PHED), and four others -- Rajnish Bal, Mohammad Amin Wani, Nisar Ahmad Bhat, and Imran Baba, a partner in M/s Baba Enterprises, under the provisions of the Prevention of Money Laundering Act (PMLA), 2002."

The special PMLA court has issued a pre-cognisance notice to all the accused persons in connection with the fraud case, the statement added.

The ED initiated an investigation on the basis of an FIR registered by the Anti-Corruption Bureau in Srinagar against Ghulam Mohammad Bhat and four others for misappropriation of government funds, the statement said.

"The ED investigation revealed that the accused officials of PHED, in criminal conspiracy with M/s Baba Enterprises, misappropriated government funds during procurement of spare parts for water filtration plants, thereby causing wrongful loss to the public exchequer. The ED investigation revealed that Ghulam Mohammad Bhat and other members of the Departmental Procurement Committee with the connivance of Imran Baba, a partner of M/s Baba Enterprises awarded tender to M/s Baba Enterprises without following due procedure and undue favours were given by the Departmental Procurement Committee for awarding tender i.e. separate tender was not floated for the additional procurement of spare parts worth Rs 2,30,78,597 and security deposits (two per cent of the tender value) were not taken from the contractor," the ED statement added.

"Instead, Earnest Money Deposit of Rs 1 lakh was converted into security deposits. In second order, security deposit (two per cent of the value of second supply order) was again not taken."

"The total security deposits were to be taken as Rs 7 lakh, however, only Rs 1 lakh was taken as security deposit. Also in the allotment order, the supply/delivery period of the material was modified from 30 days beginning from the date of issuance of supply order to 90 days, etc," the statement said.

"The ED investigation further revealed that M/s Baba Enterprises received Rs 3.54 crore from PHED and paid only Rs. 1.55 crore to the original supplier i.e. M/s Industrial Devices (India) Private Limited, New Delhi, and diverting the remaining Rs 1.56 crore, which was utilised for acquisition of immovable properties in Srinagar such as 18 marla land in Barinambal and 27.5 marla land in Hyderpora, Srinagar, and the ED has attached these immovable properties worth Rs 1.56 crore," the statement added.

During the peak years of terrorist violence in Jammu and Kashmir, the rule of law and accountability in public service had become the first casualty.

After the rule of law was re-established and accountability fixed for frauds committed in the heydays of terrorist violence, several frauds and scams committed during that period are now coming to light.

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