How to become a crorepati overnight
J Gopikrishnan | New Delhi (Pioneer, Thursday, December 11, 2008)
When the spectrum controversy began to spin out of control and Telecom Minister A Raja was recently attacked by political leaders from within the UPA and outside for his questionable decisions, his mentor and DMK leader M Karunanidhi condemned the critics as people who could "not tolerate the rise of a humble Dalit". As it turns out, the 'humble Dalit' allowed his ministerial clout and official address to be used for businesses which later connected with the spectrum deal, now under the scanner of the high court and the Central Vigilance Commission (CVC).
Not only did a commercial organisation, with the Minister's wife as a director, begin operating from his official residence, well-placed sources said the information was concealed from the Prime Minister in violation of Service Rules. The Minister did not also deem it necessary to file an affidavit of 'non-conflict of interest' between his family's business activities and his role as a Union Minister. In course of time, the address was changed and his wife officially withdrew from the firm. But the company's association with the Raja family continued as closely as before, with the shares distributed among his kith and kin.
Green House Promoters Private Limited was formed barely four months after Raja became a Cabinet Minister (in charge of Environment and Forests) for the first time in May 2004. The Chennai-based real estate company was floated with an initial capital of only Rs 1 lakh, with AM Sadhick Batcha â" a close associate of Raja â" as managing director and Sadhick's wife Reha Banu as a director. Sadhick hails from the Minister's Perambalur constituency in Tamil Nadu. Documents filed with the Registrar of Companies show that Raja's close relatives â" such as his brother, nephew, niece and a few others â" subsequently became directors in the company. With these high-profile inductions, the share capital of the firm surged to a respectable Rs 3 crore within 14 months of the operations being launched.
Three years later, in February 2007, the Minister's wife, MA Parameswari, was added to the board as a director. Raja neither informed the Prime Minister of his wife's and other relatives' business activities, which he was mandated to do according to the Services (Conduct) Rules, nor filed an affidavit assuring there would not be a conflict of interest between his duties as a Minister and the business deals of his wife and other relatives.
Even as Green House Promoters Private Limited continued to expand its real estate activities in Tamil Nadu (and Karnataka), with the Minister's official residence doubling up as his wife's business address, Raja was jolted by a report in early 2008 in a section of the media that pulled up the then Union Home Minister Shivraj Patil for using his official address as the business address for his son. Sensing trouble ahead, Raja got into damage control mode. His wife resigned from the directorship of the company on February 2008, but not before transferring her shares to another relative.
Documents available with The Pioneer show the shares were transferred to Raja's niece, Malarvizhi. The 29-year-old is the wife of Raja's nephew, a Government pleader in Tamil Nadu. The joint managing director of Green House is Raja's elder nephew RP Paramesh Kumar. The Minister's brother, A Kaliaperumal, is also a director of Green House. Another director of this company is R Ram Ganesh, the 22-year-old son of Raja's elder brother A Ramchandran, who is an Indian Forest Service officer.
From a humble beginning of Rs 1 lakh, the company soon soared to great heights. One of the Green House company's accounts at Canara Bank's T Nagar branch in Chennai had remittances of more than Rs 150 crore over the last four years. The money came from the Middle East, Hong Kong and Singapore, besides India, though it remains unclear why these remittances were made.
As the volume of business transactions increased, the company opened an office in Singapore in 2006. According to sources, it was done to cut down on the direct flow of funds into its Indian accounts and escape public scrutiny.
The failure to inform the Prime Minister and file an affidavit was not a one-time lapse or an 'oversight' by Raja. Wife Parameswari and the Minister's relatives became active partners in another company floated a month after Green House came to exist. Breaching rules again, Raja did not inform the Prime Minister and filed no affidavit of non-conflict of interest. The new company, once again dealing in real estate, had a miraculously high turnover of Rs 755 crore in its very first year of operation.
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