The Serious Fraud Investigating Office (SFIO) has told the Supreme Court that it is all set to prosecute various Vaishnavi group companies owned by controversial former corporate lobbyist Niira Radia for alleged violation of the Companies Act.
In an affidavit filed before the apex court, SFIO said that Ministry Of Corporate Affairs (MCA) has granted sanction and filing of prosecution against the companies is under process.
SFIO, which comes under the Ministry, has the mandate to probe white-collar crimes and frauds.
"The filing of prosecution by SFIO as directed by MCA is under progress. Sanctions have been accorded by the MCA against various Vaishnavi group companies for filing prosecution under the Companies Act," the affidavit said while giving details of various provisions of the Companies Act allegedly violated by the group firms.
The agency also informed the court that it has completed the probe against Vaishnavi Corporate Communications and its eight group companies and the final investigation report was submitted to MCA on January 22.
The agency said that on the direction of MCA it has also sent its reports to CBI and Income Tax department for taking action on their part.
"The Ministry vide letter dated February 5 issued instructions to SFIO for filing prosecution under various charges under the Companies Act made out in the investigation report. MCA has also directed the SFIO to forward a copy of the report to the IT Department and the CBI for necessary action at their end.
"SFIO has further been advised to forward the relevant extract of the report to the Registrar of Stamps, Department of Revenue, Government of Haryana for examination of stamp duty violation," it said.
Apart from Vaishnavi Corporate Communications, other companies which have come under SFIO scanner are -- Vaishnavi Advisory Services, Leisure Club India, Claro Consultancy, Magic Airlines, Crownmart International India, Maansi Agro, Vitcom Consulting and Neucom Consulting.
The agency told the apex court that it is in the process of lodging a former complaint with ICAI (Institute of Chartered Accountants of India) and ICSI (Institute of Company Secretaries of India) for initiating disciplinary action against the concerned auditors and company secretaries respectively, as per MCA's direction.
Vaishnavi group was a major player in corporate communications and public affairs business with high profile clients like Tatas, Unitech and Reliance Industries. It exited these activities in October 2011 after Radia got embroiled in a major controversy pursuant to leak of certain tapped conversations she had with businessmen, ministers, political leaders, journalists and others.
In 2012, then Corporate Affairs Minister Veerappa Moily ordered an SFIO probe into nine Vaishnavi group entities after certain irregularities came to light during a scrutiny by the Registrar of Companies.
Radia has been questioned several times by investigative agencies, including CBI and Enforcement Directorate, over such conversations.