A Public Interest Litigation (PIL) has been filed in the Bombay High Court seeking a probe by the Central Bureau of Investigation (CBI) or a Special Investigation Team (SIT) into the alleged acceptance of fraudulent bank guarantees by the Mumbai Metropolitan Region Development Authority (MMRDA) from Megha Engineering Infrastructure Ltd (MEIL) for the Rs16,600.40 crore Twin Tube Road Tunnel between Thane and Borivali.
The petition, filed by senior journalist V Ravi Prakash, alleges that fraudulent Bank Guarantees (BRs) were issued by a foreign entity in favor of MMRDA on behalf of MEIL. It was mentioned by Senior Advocate Prashant Bhushan before a bench of Chief Justice Alok Aradhe and Justice Bharati Dangre on Tuesday, which agreed to hear the matter next week.
As per the PIL, the BRs were issued by Euro Exim Bank, a St. Lucia-based entity incorporated under the laws of England & Wales, which is neither recognised as a foreign bank or a commercial bank or a scheduled bank by the Reserve Bank of India (RBI). Yet it issued guarantees for the tunnel project.
MEIL has obtained advance payment from MMRDA without actually providing a genuine bank guarantee as per RBI guidelines, thereby “jeopardising the project and public funds”, the plea contends.
The State Bank of India (SBI) authenticated the SWIFT messages of the Euro Exim Bank’s BRs without conducting due diligence or assessing potential risks, it contended. The PIL refers to the September 2017 circular by Maharashtra Public Works Department and June 2018 circular by MMRDA Finance Account Division which specify that BRs of nationalised banks should only be accepted for public procurement.
The petitioner alleges that MEIL submitted six fraudulent BRs for the project and asserts: “The Bank Guarantee is a sham created only to circumvent and play fraud to obtain public funds without providing any secured guarantee, with knowledge that the same could not be realized.”
The plea alleges possible quid pro quo arrangement between MEIL and political parties via electoral bond donations. It points out that MEIL was the second-largest donor of electoral bonds, purchasing bonds worth Rs980 crore between April 12, 2019, and October 12, 2023. The petitioner highlights that MEIL donated Rs584 crore to the BJP, Rs195 crore to Bharat Rashtra Samithi and Rs85 crore to the DMK. MEIL secured key projects, including the Thane-Borivali tunnel, due to its alleged political funding, the plea alleges.
Despite repeated complaints to the RBI, CBI, Comptroller and Auditor General (CAG), and the Finance Ministry, but no action has been taken, it claimed.
The PIL seeks a court-monitored CBI or SIT investigation into the alleged scam. It also urges MMRDA to terminate the contract awarded to MEIL and requests the freezing of MEIL’s accounts and assets to prevent the transfer of funds obtained through fraudulent transactions. Additionally, the petitioner demands an independent forensic audit of all projects handled by MEIL.
