Monday, August 29 2005 18:47 Hrs (IST) - World Time -

New Delhi: The Supreme Court today (Aug 29,2005) directed the Central Vigilance Commission to carry out detailed inquiry and submit its report within four months on the alleged misappropriation of around Rs 14,500 crore Housing and Urban Development Corporation (HUDCO) funds during the tenure of Ananth Kumar as Urban Development Minister in previous National Democratic Alliance (NDA) Government.

A Bench comprising Justice S N Variava and Justice H K Sema also asked the CVC to inquire into specific allegation of misuse of funds of HUDCO by Kumar with a clear cut direction to the Managing Director of Public Sector Undertaking to supply to CVC all documents and materials pertaining the matter.

The Bench directed the concerned authorities to appoint aChief Vigilance Officer in HUDCO within six weeks. The matter has been pending before Department of Personnel and Training.

The Public Interest Litigation (PIL) filed by Centre for Public Interest Litigation (CPIL) had alleged malafide and arbitrary use of power in sanction of loans.

CPIL counsel Prashant Bhushan submitted that CVC had gone into some cases and have found irregularities in them.

He pointed out that a loan amounting to Rs 5000 crore was sanctioned in a day by three part-time Directors of HUDCO in absence of a single permanent Director.

CPIL had alleged that the then Urban Development Minister misused the funds for paying his mobile bills and other private affairs.

The counsel submitted that that there was no vigilance set up in the PSU and the post of Chief Vigilance Officer (CVO) was vacant since May 14, 2004.

However, Additional Solicitor General Gopal Subramaniam said that the issue of full time CVO was pending with CVC and within six months period it will be taken care of.

The Apex Court had last year issued notices to the Centre, HUDCO and the then Urban Development Minister Ananth Kumar on the petition.

CPIL had brought to the Court's notice alleged "Malafide and arbitrary use of power and public finances of HUDCO by the malafide sanction of loans to the tune of Rs 14,500 crores and release of Rs 8,500 crores subscription in privately placed debentures of Rs 1250 crores and write off of Rs 550 crores during the financial year of 2002-03."

This has caused grave loss to the public exchequer and resulted in further accumulation of non-performing assets in the country which was already to the tune of Rs 1,00,000 crores, it had said.

The petitioner had sought a through probe into the scam so that erring officials and public servants could be brought to book.