July 02, 2020

CBI case against GVK chairman, son for siphoning off Rs. 705 crore

[ by Legal Era News Network ]


The Central Bureau of Investigation (CBI) has registered a case against Gunupati Venkata Krishna Reddy, the Chairman of the GVK Group of Companies and his son G.V. Sanjay Reddy, Managing Director of Mumbai International Airport Ltd. among others for alleged irregularities to the tune of Rs. 705 crore in running of the airport, officials said.

According to the CBI, the Airport Authority of India (AAI) had formed a joint venture with the GVK Airports Holdings Limited, promoted by the GVK group under public private partnership firm Mumbai International Airport Ltd. (MIAL) for upgradation and maintenance of the Mumbai Airport.

The FIR said that on April 4, 2006 the Airport Authority of India Ltd. (AAI) entered into an agreement with MIAL for modernisation, upkeep, operation and maintenance of the Mumbai airport with MIAL.

“It is alleged that the promoters of the GVK group in MIAL in connivance with their executives and unidentified officials of the AAI resorted to siphoning of funds using different ways,” officials said.

The CBI has alleged funds were siphoned by showing the execution of bogus work contracts to nine companies in 2017-18 that caused a loss of Rs. 310 crore. Further, the promoters of GVK group allegedly misused reserve funds of MIAL to the tune of Rs. 395 crore to finance their group companies.

The agency has also alleged that a revenue loss to AAI was caused as the group inflated expenditure figures of MIAL by showing payments to employees at their headquarters and group companies who were not involved in the running of MIAL.

There are also allegations that the promoters under-reported revenue earnings of MIAL by entering into contracts with related parties and meeting their personal and family expenses using MIAL funds.

MIAL is a joint venture of the GVK Group, Airport Authority of India and a few foreign entities.

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