The petition by the legislators states that the Enforcement Directorate's interference negatively impacts development projects in Kerala.
Image of a gavel and closed law book. (Wikimedia Commons)
As the row over Enforcement Directorate (ED) summons to former finance minister Thomas Isaac continues in Kerala, five CPI(M) MLAs — including former health minister KK Shailaja, IB Satheesh, M Mukesh, and E Chandrasekharan — filed a petition in the Kerala High Court against the interference by the agency over state-government projects.
South First is in possession of the petition filed by the legislators. The petition says the ED and its deputy director are attempting to tarnish the credibility of the Kerala Infrastructure Investment Fund Board (KIIFB).
“The funds received by 5th respondent by issuance of masala bond permitted by the 3rd respondent Reserve Bank of India is strictly in accordance with Foreign Exchange Management Act. As stated earlier the only gateway through which the aforesaid fund is obtained is with the Reserve Bank of India,” the petition states.
An exhibit produced before the court shows there are 142 projects approved in general education at an approval amount of ₹2,869.30 crore, 68 projects of the health department for ₹4,943.80 crore, 449 projects of the PWD at an approved cost of ₹25,754.30 crore, and ₹16,000.077 crore for industrial parks, the Kochi-Bengaluru industrial corridor, and Gift City.
The petition by the legislators was to be heard on Thursday, 11 August, by a bench headed by the Chief Justice of the Kerala High Court.
Constituted by the LDF government in 1999, the KIIFB claims to be a principal funding arm of the government of Kerala: A flagship project by the government aimed at building large public infrastructure projects in Kerala.
The chief minister of Kerala is the chairperson of the board, and the finance minister is its vice-chairperson.
The RBI on 1 June, 2018, granted the KIIFB permission to raise foreign loans.
Since then, the Opposition in Kerala has constantly criticised the government for its use of masala bonds — the name given by the International Finance Corporation (IFC) for bonds issued in rupees — for infrastructure projects in the state.
Meanwhile, Isaac — who has received summons twice from the ED — has filed a petition to stop further processes in the case. He said in his petition that neither of the two notices he received from the ED mentions anything about the offence that he is accused of.
“Why am I asked to appear before the ED? What offence did I commit? If they can’t inform me of such details, my prayer is to nullify the summons before the ED,” Isaac told reporters in Thiruvananthapuram on 11 August.
“It is said that the case is related to FEMA (Foreign Exchange Management Act). Did I or the KIFFB violate the law? If that is their argument, that should be first pointed out to the RBI as it was the RBI that gave NOC and registration number for masala bonds,” he added.
The petition by Isaac also said the pattern in which the summons were issued by the ED to the officials of KIIFB and the Kerala State Information Technology Infrastructure Ltd (KSITIL) and giving of publicity to it through the media give rise to the “irresistible apprehension” that the move was a part of an “organised smear campaign”.
The petition further stated that these proceedings were enacted by “vested political interests” to discredit the Kerala government’s machinery.
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