Congress on DDCA scam
Findings against DDCA during Arun Jaitey’s tenure as President, DDCA (December, 1999 to December, 2013)
Following are serious findings against affairs of DDCA during Shri Jaitley’s tenure as President DDCA. Shri Jaitley is now heading the important Ministry of Finance and virtually all enforcement authorities- ED, IT, Revenue Intelligence etc. directly report to him. The same agencies are supposed to take action against DDCA for infraction of various rules and norms of the companies act and under criminal law.
DDCA was incorporated as a Section 25 Company (non-profit Co.) under the Companies Act, 1956.
→It functions from it registered office at Ferozshah Kotla Grounds.
Ferozhah Kotla Construction Scam (2002-2007)
a)Investigation by SFIO – In the year 2012, the Director, Serious Fraud Investigation Office (SFIO), Ministry of Corporate Affairs received complaints regarding financial irregularities in the construction of Ferozshah Kotla Stadium by DDCA (a section 25 Non-profit Company).
b)Escalation of cost by 90 crores – During the course of investigation on 01.12.2012, the DDCA conceded to the SFIO that reconstruction of Kotla was carried out between 2007 to 2007. The initial budget was 24 crore but eventually ended up costing 114 crore.
→As per the investigation by the SFIO, the Original Contract given to Engineer Project India Limited (EPIL) was for Rs. 24 crore, however, the final payment was made for Rs. 114 crores.
c)No tenders issued – It was also revealed during the investigation that there was no record of tender for most of the contracts issued by DDCA for construction of the Ferozshah Stadium.
d)Nepotism – Many companies that were given contracts of construction and allied work of Ferozshah Stadium were actually owned by the office bearers of the DDCA.
e)Corporate Boxes – DDCA has illegally constructed 10 Corporate Boxes in the stadium and have sub -leased these boxes for 10 years to corporate for a collective approximate amount of Rs 36 crore.
- Irregularities in Accounts of DDCA –
During the course of the investigation, the SFIO has found the following irregularities in the Accounts of DDCA during ShriJaitley’s tenure:
a)Non-Disclosure of Annual Accounts- The DDCA has contravened with Section 211 of the Companies Act i.e. mandatory disclosure of accounts by a non-profit company.
b)Non-maintenance of Accounts of Expenditure and Income – The DDCA has violated Section 209, 303 and 150 of Companies Act and has not maintained the accounts of Expenditure and Income of DDCA, hence DDCA was being run in a non-transparent manner.
(Extracts of findings of SFIO are attached as Annexure B)
- Report of Internal Fact Finding Committee of DDCA
After Shri Jaitley’s exit, the DDCA constituted an internal Fact Finding Committee on 13.12.2014 which only inquired into the affairs of DDCA for the limited period of year 2013-14. Even for this limited period, the Committee found that there is evidence of “huge financial irregularity”. The Committee goes on to note that “On enquiry, it has been revealed that many spurious and illegitimate payments have been made to certain companies in 2013-20’4 and till 09.12.2014. Not only this, it is an apparent fact that Association is over-staffed; still a lot of money has been spent on hiring superfluous workers. Apart from this, large scale payments have been made in the form of overtime.”
Following are the relevant findings of the Committee:
a)Unauthorised payments by Shri Jaitley – The Committee observed that huge payments have been made in a hurry by the President, Mr S.P. Bansal and General Secretary, Mr. Anil Khanna, without following the financial manual and authentication by proper authorities which clearly shows the irregularity in the financial transactions of the Association.
b)Irregularity in payment of legal matters to: The Committee observed that payments were made for legal matters to companies for appearing against the Association. In another incident, it was observed by the Committee that Mr. J. S. Bakshi was appearing as an advocate on behalf of the Association but he was raising bills in name of his son, Mr. Amitesh Bakshi. This was done so because Mr. J.S. Bakshi, being a member of the Association is not entitled to receive any remuneration / payment in any form whatsoever. Therefore, the Committee was of the opinion that this amounts to proxy litigation I proxy billing. The Committee has noticed that bills have been cleared and paid without verifying the same.
c)An amount of Rs. 1.55 crore was loaned by the DDCA to three different companies, Vidhan Infrastructure Pvt. Ltd., Shri Ram Tradecom Pvt. Ltd., Maple Infrareality Pvt. Ltd. A charitable company cannot give a loan for commercial purposes. There is no documentation regarding this transfer apart from account entries and this prima facie seems a case of theft and/or criminal breach of trust.
d)Substantial payments were made to 9 companies which, on investigation, turned out to have the same registered office, same e-mail IDs as well as common directors, Duplicate bills were issued and the reasons for payments are falsified by ledger entries including a case where one Manu Technical & Financial Consultant (P) Ltd. And Neofam Trading Co, were paid for work that had already been done by one Ritu where Engineers and contractors in June, 2013.
e)The Committee noted that payments have been made to companies which have never done any job/work or assignment for which the payments were made to them.
f)The Committee noted that heavy professional charges were being paid to many personal firms on account of duplication of works. The Committee reported payment of Rs. 1.15 crores to 16 such firms.
Forged Certificates openly accepted for selection of Cricketer-
a)An FIR has been lodged by ShriKirti Azad in PS I.P. Estate on 15.12.2014 U/S Sections 420, 468 and 471 on the issue of acceptance of forged certificates by DDCA. ‘ The FIR names specific players who have benefited from forged date of birth and school certificates. (Copy of FIR is Annexure E)
b)Forged age-verification ceftificates are being prepared and accepted in a systematic manner by the DDCA in collusion with Vidya Jain Public School, Rohini to allow over-age players to play in younger age groups.
c)Such certificates are openly accepted by DDCA officials in exchange of monetary consideration.
- DDCA / FerozshahKotla operating without MCD permissions-
a)DDCA – The DDCA, since 2005 onwards has been holding international cricket matches without obtaining occupancy certificate and by obtaining provisional occupancy permission from MCD.
However, since such event remain matter of national pride and provisional permission is sought at very last moment, SDMC is left with no option but to consider it irrespective of the fact that no such provision exists in Building Bye-laws-1983 or DMC Act-1957.
b)Ferozshah Kotla – The report dated 17.11.2015 by GNCTD’s Committee to inquire into DDCA’s irregularity confirm that large Scale unauthorized construction without requisite permissions from the Municipal Corporation of Delhi and the Delhi Urban Arts Commission.
Findings of 2 member Commission constituted by Delhi Court vide Order dated 20.06.2015 – The Delhi Tees Hazari Court vide Order dated 30.06.2015 constituted a 2 member commission to look into lack of transparency of DDCA and the its internal election procedure.
→ This commission was headed by Addl. Session Judge GP Thareja.
→The prima-facie finding of this commission were:
a)that the there is acute lack of transparency in the working of the DDCA;
b)Members of DDCA were illegally running private cricket academies under the umbrella of DDCA and minting money;
c)No scope for general students and genuine players to participate in DDCA matches.
→During the course of the investigation, in Order to look into the culpability of the Top Brass, the Commission demanded DDCA to make available all relevant records of the Executive Committee.
→However, the Commission was not given any documents despite having written to the President, DDCA.