CBI to probe Vedanta role in HZL stake sale

The CBI has started investigations into the alleged irregularities in the disinvestment of 26 per cent stakes in Hindustan Zinc Ltd (HZL) during the NDA regime and Anil Agarwal-led Vedanta Group picking up stake in the Public Sector Undertaking (PSU) at "undervalued" price.

The preliminary enquiry has named Agarwal and unnamed officials of the HZL, Ministry of Disinvestment and Ministry of Mines, accusing them of causing loss to the exchequer to the tune of crores of rupees. Officials of Vedanta could not be contacted for their response.

Sterlite Industries, which is a group company of Vedanta Resources, had picked up stake in the PSU at "undervalued" price resulting in the estimated losses running into hundreds of crore to the exchequer, the CBI has claimed. The Sterlite Industries was merged with another group Sesa Goa in August this year and renamed as Sesa Sterlite. CBI officials claimed that there are alleged serious flaws in the disinvestment process undertaken by the then government in 2002.

The agency may notices to those involved in the case to appear before the CBI to join the probe along with relevant records of the stake sale. The NDA government had then justified the stake sale to Sterlite, saying there was a spurt in the share prices of HZL after the successful disinvestment of VSNL and IBP.

The statement had said two bids were received from Indo Gulf Corporation and Sterlite Opportunities and both were above the reserve price of 32.15 per share (translating into Rs 353.17 crore) for 26 per cent stake. The higher bid was that of Sterlite for Rs 445 crore and was accepted, it had said.

The alleged irregularities in the stake sale were raised by lawyer Prashant Bhushan before the then finance minister Pranab Mukherjee, claiming illegality in selling the remaining stake to the Sterlite as the process undertaken in 2002 was against the law laid down by the Supreme Court which has stopped the disinvestment of Hindustan Petroleum.