CWG Scam: DDA to Confiscate Rs 183 Cr Emaar-MGF Bank Guarantee

New Delhi, Oct 20 (PTI): The Rs 183 crore bank guarantee furnished by Commonwealth Games village builder Emaar-MGF was today ordered to be confiscated on charges of irregularities, as the ED prepared to question top officials of the Organising Committee for alleged foreign exchange violations.

A Rs 760 crore bail out package given by Delhi Development Authority(DDA) for Emaar-MGF, a private builder, also came under the scanner, sources said.

As the multi-pronged probe into alleged corruption and financial irregularities in the Games scam gathered momentum, the Comptroller and Auditor General (CAG) seized files relating to various construction works carried out by CPWD and DDA.

Official sources said the Enforcement Directorate(ED) is likely to issue summons to top OC officials including Secretary General Lalit Bhanot in a case of alleged foreign exchange violation related to the Queen Baton Relay in London. Bhanot said he has not received any summons by the ED.

Cracking the whip, the Government ordered legal action against the private builder Emaar-MGF after the DDA detected "irregularities" and deficiencies in the Games Village.

The direction for confiscation of the Rs 183 crore bank guarantee was given by the Urban Development ministry to the DDA which had given the contract to the builder, ministry sources said.

The Government action came a day after DDA submitted an interim report to the UD ministry in which it said there were "various deficiencies" and "irregularities" in  construction of the Village and the builder had exceeded the  permissible limits of construction.

Emaar-MGF on its part said the Village was built to the "highest standards of quality and design" and all the pertinent milestones were achieved as per their scope of work.

The company also said all deficiencies pointed out by DDA or any other agency were duly rectified by it.

The bail out package was provided by DDA which purchased 333 flats from Emaar-MGF. The package was said to have been worked out by the Delhi's LG, who is the Chairman of the DDA, and was cleared by the Centre.

BJP leader Sudhanshu Mittal, whose premises were searched by Income Tax officials yesterday in connection with irregularities in CWG projects, meanwhile refuted corruption charges and accused the government of making him a "political scapegoat" and indulging in "witch-hunt".

Regarding the likely summoning of the OC top brass, official sources said the ED wants to confront them with certain documents that it has laid hands on.

The ED has already registered a case under Foreign Exchange Management Act (FEMA) in this regard. The ED has obtained a "fair amount" of details about the banking transactions undertaken by the Games body, the sources said.

A CAG team also picked up files pertaining to contracts awarded for public address systems, LED display boards and other communication systems for various Games stadia, sources said.

Mittal claimed that his company Delhi Tents and Decorative did business worth only Rs 29 lakh in CWG contracts out of the Rs 77,000 crore earmarked for various projects,

"I am being made a political scapegoat," he said, adding neither he nor any of his family members were involved in corruption in CWG projects.

The Income Tax department was also preparing a "family tree" of all senior officials, individuals and their relatives who have bagged Commonwealth Games contracts and also of consortiums which entered into joint ventures with foreign entities to float firms.

As part of its probe into alleged financial irregularities in work related to the sporting event, the department, which conducted searches at almost 30 premises of business consortiums, including those associated with Mittal yesterday, has collected PAN card, credit card and bank account details of the officials and contractors.

Sources in the LG's office said Tejender Khanna had directed the DDA to carry out a thorough audit of all transactions relating to expenditure in the Games Village.

The sources said that the bailout package was cleared after taking the approval of all the stakeholders concerned.

In August, the ED had questioned sacked CWG Joint Director General T S Darbari and suspended Deputy Director General Sanjay Mohindroo for several hours over alleged financial irregularities in connection with the mega event.

Darbari, a close aide of OC chairman Suresh Kalmadi, and Mahindroo were summoned to explain certain financial transactions undertaken during the Queen's Baton Relay in London last year.