A Division Bench of the Kerala High Court on Thursday reserved its verdict on a public interest litigation moved by five Left Democratic Front (LDF) legislators seeking to restrain the Enforcement Directorate (ED) from interfering in the affairs of the Kerala Infrastructure Investment Fund Board (KIIFB).
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The petition was filed by K.K. Shailaja, E. Chandrasekharan, Ramachandran Kadannappally, M. Mukesh and I.B. Satheeesh.
They said in the petition that repeated summons and inquiry conducted by the ED into the masala bond transactions of the KIIFB was tarnishing the goodwill of the KIIFB and would create doubts in the mind of the domestic financial institutions about the financial condition of the board. The ED’s actions had an “adverse economic impact” on the State.
The raising of ₹2,150 crore by way of the bond sale was strictly legal and the Reserve Bank of India (RBI) had no complaints about it.
The petition pointed out that the officers, including the Chief Executive Officer of KIIFB, had been summoned frequently, exercising powers under the Foreign Exchange Management Act (FEMA). They had appeared before the ED. The ED was trying to give an impression that there was something wrong with the board, the petition said.