Hyderabad:
On a day when VRS Natarajan, Chairman and Managing Director of Bharat Earth Movers Limited (BEML) - one of India's biggest defence Public Sector Units (PSUs) - was questioned by the CBI while investigating the Tatra truck scam, there is more trouble for him.
NDTV has accessed an internal report of the Criminal Investigation Department's legal division in Hyderabad which opines that criminal action can be taken against Mr Natarajan for cheating, criminal breach of trust and falsification of accounts. The CID is investigating allegations and counter allegations made by BEML and it's joint venture partner Midwest Granite, where both companies have accused the other of cheating, causing losses and misappropriation. BEML-Midwest is a Joint Venture Company (JVC) was promoted in 2007 to explore the mining sector.
The report is indicative of alleged corruption as it says that Mr Natarajan "became self-centred and started doing business for personal benefits... He also deliberately suppressed facts and dishonestly transferred the loss, by making the contract from his parent company (BEML) to the JVC due to which the latter was put to Rs 2 crores loss (sic)."
The report also alleges that "Natarjan, to wrongly legalise the diversion of funds, sent emails to Senior Vice President of the JVC (sic)." It also points out that Natarajan "manipulated the documents to suit his purpose and to become unjustly enriched (sic)."
The report, signed by P Shailaja, a legal officer of the CID and dated September 7, 2010, concludes by saying, "Mr Natarajan deliberately suppressed the material facts, concealed active truth, manipulated the documents by bringing influence and caused wrongful loss to the JVC with misrepresentation of facts (sic)."
The final opinion given by the legal officer is that "BEML Ltd and its CMD are liable under criminal law under sections 420 (cheating), 409 (criminal breach of trust) and 477-A (falsification of accounts)."
Though the legal opinion was submitted to the CID's executive arm in September 2010, Midwest says it has not been acted upon and Mr Natarajan has still not been booked as there is pressure from Delhi.
"The police are very just here. But at the same time they are helpless. What I understand frankly is higher ups from Delhi, they keep calling, they say don't act. I think it's too big. And these people are really helpless. All we can do is go on pursuing but we are helpless," said K Raghava Reddy, Chairman, Midwest Group.
Legal experts say as this is only an opinion of the CID and not an order, the investigating officer can reject it. But normally, they add, the executive arm accepts the opinion as it has been scrutinised and the legal merits of the case studied by lawyers. Hence, it has important weightage on the investigation officer. CID sources told NDTV, the report is being reviewed by their senior legal officer and the investigations are still on though four years have passed since the complaints were lodged.
Apart from Natarajan the BEML's former procurement Director V Mohan and Tatra chief Ravi Rishi was also questioned by the CBI today.
The investigation agency wants Mr Natarajan, who is not an accused in the case, to clarify his stand on certain decisions that were taken by the BEML while signing memorandum of understanding (MoUs) with Tatra.
Tatra is a Czech-manufacturer. It is owned by Vectra, a London-based company, which supplies parts to BEML, which is based in Bangalore. The trucks are assembled at BEML and sold to the Army. General VK Singh, the chief of the Army, had disclosed last month that he was offered a bribe to clear "sub-standard" trucks, which brought the Tatra deals with the Army under scanner. The Army has bought 7000 Tatra trucks since 1986.
The CBI is pursuing two different cases on the Tatra deals. One relates to the purchase of the 7000 trucks. The other looks at a new consignment of more than 700 trucks that Vectra was allegedly trying to push through. In the former, the CBI has allegedly been granted permission by the Defence Ministry to prosecute Mr Natarajan.
Mr Natarajan had earlier denied that he ever received complaints about either the acquisition or the performance of Tatra trucks. He said he could not understand why the Army Chief might think of them as "sub-standard".
CID sources say that the report will be reviewed once again by a senior law officer and the investigation is still on. But the question is: Since Mr Natarajan was under investigation, why was he allowed to head one of India's biggest defence PSUs? And more importantly, after this damaging opinion by the CID's legal arm, will there be any action against him?