Thaindian News

New Delhi, Sep 5 (IANS) The Supreme Court Monday issued notice to the government on a plea challenging the appointment of Atul Kumar Rai as the chief executive officer and managing director of the Industrial Finance Corporation of India (IFCI) despite his alleged involvement in “serious corrupt practices”.

An apex court bench of Justice Aftab Alam and Justice R.M. Lodha issued notice on a public interest litigation (PIL) filed by the Centre for Public Interest Litigation (CPIL), saying that the matter involved huge amounts of public money and required speedy hearing.

The government has been asked to reply in six weeks’ time.

Initially, the court said that before a petition could be moved before it, the matter should go to the competent authorities, including high court.

Appearing for the CPIL, senior counsel Prashant Bhushan told the court the peitioner did not approach different authorities but gave representations to various authorities, including the prime minister and MPs.

He said that the CPIL had no qualms about going to the high court but it approached the apex court because the matter needed to be dealt with expeditiously.

Bhushan told the court that while a huge amount of government money was going into IFCI, the institution was functioning without accountability. The court was told that the government had already pumped nearly Rs.5,000 crore in IFCI.

The CPIL accused Rai of financial irregularities and said the government was not taking any action despite its authority over IFCI.

The petition said that the finance ministry while releasing grants to IFCI stipulated that it would not have performance-linked schemes for its staffers.

It said soon after Rai took over the reigns of IFCI he introduced the incentive scheme in August 2007 and, in the way, ?rewarded himself, along with his associates with hefty amount of incentives?.

Referring to another instance of irregularities after the arrival of Rai in IFCI, the petition said that the financial body purchased five percent stakes in a company at Rs.35 per share whereas the Union Bank of India and Bank of India bought these at Rs.10 per share.

It also pointed to sanction of Rs.225 crore to Blue Coast Hotels, a declared defaulter, and the repeated extension of employment of a “tainted officer?.