Two arrested in wheat import fraudJuly 9th, 2008 - 8:43 pm ICT by IANS
New Delhi, July 9 (IANS) A former chief of the State Trading Corp (STC) is among two people arrested in connection with alleged irregularities in the import of wheat from Australia in 1998, it was announced Wednesday. The arrests followed searches the Central Bureau of Investigation (CBI) conducted at six places late Tuesday. The arrested men were identified as former STC chief managing director S.M. Dewan and H.R. Sardana.
The CBI got the permission to reopen the case July 7 and searched six places in New Delhi, Noida and Gurgaon Tuesday. These searches continued till late in the night.
“Many incriminating documents were seized from the premises which suggested that large sums of money (were) transferred to their accounts from abroad,” a CBI official said.
Among the findings the CBI made acquisition of properties and assets by the men including 14 immovable properties running into millions of rupees in Delhi, Noida, Faridabad and Gurgaon.
“Evidence was found of huge investments in shares and bonds valued conservatively at over Rs.15 million in addition to costly household items and three cars,” the official said.
The two were produced before the court of Additional Sessions Judge V.K. Maheshwari who sent them to CBI custody for eight days.
Dewan and other officials were allegedly involved in the award of contract to the Australian Wheat Board (AWB) and played a crucial role in the deal.
The CBI registered the case in September 2001 following allegations that the decision to import two million tonnes of wheat from AWB was taken even though the stock position of wheat was comfortable in 1998.
The various other bidders were rejected allegedly on frivolous grounds and the contract was awarded to AWB at exorbitant prices.
During the investigation, a letter rogatory (LR) was sent to Australian authorities seeking information on certain vital aspects like involvement of middlemen in this contract and the payments of commission, if any, in this deal.
The CBI had filed the closure report in the case in January 2004 because Australian authorities did not provide the required information then.
However, a subsequent inquiry by the Australian government on the conduct of Australian companies involved in the UN Oil for Food Programme for Iraq revealed that AWB paid commission in the sale of wheat to India in 1998.