The Central Bureau of Investigation has registered a case against Ranchi Expressway Limited, its chairman-cum-managing director K. Srinivasa Rao and others for alleged irregularities in the use of ₹1,029 crore of funds borrowed from a consortium of banks led by Canara Bank. A sum of ₹264 crore was allegedly diverted on various pretexts.
Among those named in the case are the company directors N. Seethaiah and N. Prithvi Teja; Madhucon Project Limited, Madhucon Infra, Madhucon Toll Highway Limited and auditing firm “Kota and Company.” Unknown bank officials are also under the scanner.
Project details
The case has been registered following a preliminary inquiry ordered by the Jharkhand High Court. It relates to a project for four-laning of a 163-km stretch on National Highway-33 linking Ranchi to Jamshedpur. The National Highways Authority of India had allocated the work to Madhucon Project Ltd on March 18, 2011.
A special purpose vehicle, Ranchi Expressway, was floated for the project worth ₹1,655 crore. A consortium of 15 banks agreed to lend ₹1151.60 crore. The Ranchi Expressway office-bearers round-tripped ₹50 crore, diverted ₹22 crore, claimed ₹98 crore as maintenance and used ₹94 crore as mobilisation advance, as alleged by the Serious Fraud Investigation Office.
It is alleged that the directors had fraudulently got released a total loan of ₹1,029.39 crore, but there was no progress in the project.
The National Highways Authority of India terminated the contract on January 31, 2019, and forfeited ₹73.95 crore.