SFIO receives complaint against L&T; group rubbishes it as baseless

The Serious Fraud Investigation Office (SFIO) has received a complaint against Larsen & Toubro alleging "thousands of crores" of financial irregularities, including money laundering and tax evasion, a charge that the infrastructure giant rubbished as "baseless".

Acting on the complaint received, SFIO's Mumbai regional office has written to the head-office here stating that it "is a fit case to be investigated" as it will "help in unearthing wrong doings of L&T group, in terms of misappropriation of money, money laundering and tax evasion".

In the complaint, Rajya Sabha MP Kahkashan Perween has stated that loans worth Rs 8,000 crore given to the Group for road projects face serious threat of turning into NPAs. It stated irregularities in two projects - L&T Halol Shamlaji Tollway Ltd (L&T Halol) and L&T Chennai Tada Ltd.

L&T and its arms, which are engaged in highway projects have been termed as "habitual defaulters" by NHAI, which is likely to have a severe negative impact on loans worth Rs 8,000 crore given by various banks to the Group, as per the complaint by the MP.

L&T, however, dismissed the allegations as "baseless and without any merit", and said it has no information about any investigation.

"Efforts by public sector banks to bail out L&T Halol Shamlaji Tollway Ltd (L&T Halol) under the guise of debt-restructuring schemes will only benefit unscrupulous promoters ie L&T at the cost of banks, financial institutions and public at large," the complaint stated.

Besides, it added that loan accounts of Chennai Tada Ltd have already turned non performing assets since September 2015 and recovery of the same is under serious threat.

"L&T and its group companies be black listed and the banks and public financial institutions be prohibited from granting any further loans to them considering their record of frittering away public money," the MP said in the letter written to the SFIO.

The complaint also sought to direct the L&T (being the holding company) to repay the loans due to banks and institutions.

When contacted, L&T said, "We are not aware of any so called investigation ... We strongly deny the allegations which are entirely baseless and without merit. L&T has always maintained high standards of corporate governance and compliance of statutory and regulatory requirements".

The company said it is important to note that L&T Infrastructure Development Pvt Ltd (L&TIDPL), the promoter of L&T Chennai Tada Tollways and L&T Halol Shamlaji Tollway, "has neither received a return of nor a return on its investments made in these two companies."