A Hyderabad-based journalist has filed a Public Interest Litigation (PIL) in the Bombay High Court, requesting an investigation by the Special Investigation Team (SIT) or the Central Bureau of Investigation (CBI) into the alleged fraudulent bank guarantees submitted by Megha Engineering Infrastructure Ltd (MEIL) for the Rs 16,600 crore Borivali-Thane underground twin tunnel project.
The PIL, filed by journalist V Ravi Prakash, was presented before a bench of Chief Justice Alok Aradhe and Justice Bharati H Dangre by Senior Advocate Prashant Bhushan. The court has scheduled the matter for a hearing next week.
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The petition alleges that fraudulent bank guarantees were issued by Euro Exim Bank, a foreign entity based in St. Lucia and incorporated under English & Welsh laws, and that this bank was not recognized by the Reserve Bank of India (RBI). These guarantees were issued on behalf of MEIL to the Mumbai Metropolitan Region Development Authority (MMRDA). The PIL pointed out that a 2017 notification from the state’s Public Works Department mandated that performance security must come from nationalized and scheduled banks, with a subsequent 2018 circular from the MMRDA Finance Account Division also stating that guarantees must be from nationalized banks for public procurement.
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Further allegations in the PIL claim that the State Bank of India (SBI) authenticated SWIFT messages linked to these bank guarantees without conducting proper due diligence or assessing any associated risks.
The petitioner also claims that MEIL provided six fraudulent bank guarantees for packages 1 and 2 of the project to secure public funds without offering valid guarantees. The PIL also hints at quid-pro-quo arrangements between MEIL and political parties concerning electoral bonds.
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The petitioner has reported submitting complaints to various authorities, including the RBI, CBI, Comptroller and Auditor General (CAG), and Ministry of Finance, but asserts that no action has been taken.
The PIL seeks a probe by the CBI or SIT into the alleged fraud and demands that MMRDA terminate MEIL’s contract for the project. Earlier in May 2023, the Bombay High Court had dismissed appeals from Larsen & Toubro (L&T), whose bids for the project were rejected by MMRDA.
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