Amid ED probe pressure, companies opened wallets for electoral bonds: Report

Future Gaming and Hotel Services and Megha Engineering Infrastructure Ltd and its group companies, were the top two donors from April 2019 to January 2024. They have donated bonds worth Rs 1,368 crore and Rs 1,232 crore, respectively.

Recently-released electoral bonds data, among other things, indicates that the time of purchase of bonds by several companies was, in some way, linked to action taken against them by government agencies, the Indian Express reported, highlighting that several companies which purchased electoral bonds did so while investigative agencies hovered on the brink of action.

At least, 14 of the top 30 donors made their contributions around the time they faced action from Enforcement Directorate (ED) or the Income Tax Department.

According to the Indian Express, 26 companies that purchased electoral bonds faced action by investigative agencies, and among them, some resorted to purchasing electoral bonds around the time of said action. Some of these companies even donated amounts that were 10 times their profits.

Qwik Supply Chain, which had a revenue of Rs 15,700 crore as of March 2023, has as stakeholders at least three Reliance-linked companies—Reliance Group Support, Reliance Fire Brigade and Reliance Hospital Management—who collectively own 50.04 per cent of its stake.

Future Gaming and Hotel Services, controlled by ‘lottery king’ Santiago Martin, and a Hyderabad-based company, Megha Engineering Infrastructure Ltd and its group companies, were the top two donors from April 2019 to January 2024. They have donated bonds worth Rs 1,368 crore and Rs 1,232 crore, respectively. 

Here's a list of firms that were mentioned in the report:

Future Gaming and Hotel Services Pvt Ltd

Bonds purchased before ED action: 0

Bonds purchased after ED action: Rs 1,365 cr

Redemptions: TMC (Rs 542 cr), DMK (Rs 503 cr), YSRCP (Rs 154 cr), BJP (Rs 100 cr), Congress (Rs 50 cr), SKM (Rs 11 cr), SDF (Rs 5 cr)

In July 2019, the ED attached assets of Future Gaming valued at more than Rs 250 crore after initiating a money laundering probe against the firm earlier in the same year.

A year later, Future Gaming made its first bond purchase in October 2020, directing all investments until October 2021 towards the DMK, YSRCP, and TMC.

The company also donated to the BJP later, purchasing bonds worth Rs 50 crore in October 2021, and an identical amount again in January 2022.

Months later, the ED attached assets of the company valued at Rs 410 crore, around which time Future Gaming bought bonds worth Rs 100 crore for the DMK. A few months later, in July, the company again purchased bonds, this time for the TMC (Rs 25 crore) and the DMK (Rs 50 crore).

Megha Engineering and Infrastructure Limited (MEIL)

Bonds purchased before ED action: Rs 125 cr

Bonds purchased after ED action: Rs 1,107 cr

Redemptions before action: BJP (Rs 120 cr), Congress (Rs 5 cr)

Redemptions after action: BJP (Rs 549 cr), BRS (Rs 201 cr), Congress (Rs 153 crore), DMK (Rs 85 cr), TDP (Rs 53 cr), YSRCP (Rs 37 cr), Jana Sena Party (Rs 14 cr), JD(U) (Rs 10 cr), JD(S) (Rs 5 cr)

Megha Engineering emerged as the biggest donor to both the BJP and the Congress, contributing Rs 669 crore and Rs 158 crore, respectively.

Hyderabad-based MEIL's bond purchases began in April 2019, months before the I-T Department raided the company's offices, which was followed by an ED probe. Prior to the raid, the company had purchased bonds worth Rs 120 crore, which had been redeemed by the BJP. In October 2019, the month of the raids, MEIL donated another Rs 5 crore to the BJP in bonds.

After nearly a year of inactivity on the bonds front, MEIL purchased bonds again in October 2020, with a Rs 20 crore donation to the DMK.

Months later, in April 2021, MEIL donated again to the BJP, and since then, MEIL and its group of companies collectively gave the saffron party Rs 544 crore in bonds.

The ruling BRS in Telangana also got its fair share of bonds from MEIL, with the firm buying its first batch for the KCR-led party in October 2021. From then till July 2023, MEIL donated bonds worth Rs 201 crore to the BRS.

Keventer

Bonds purchased before action: Rs 380.5 cr

Bonds purchased after ED action: Rs 192.4 cr

Redemptions before action: BJP (Rs 320 cr), Congress (Rs 30 cr), TMC (Rs 20 cr), SP (Rs 10 cr), SAD (Rs 50 lakh)

Redemption after action: Congress (Rs 91.6 cr), TMC (Rs 45.9 cr), BJP (Rs 26.9 cr), BRS (Rs 10 cr), BJD (Rs 10 cr), AAP (Rs 7 cr), JMM (Rs 1 cr)

The Keventer group of companies had donated bonds over Rs 380 crore prior to raids, with Rs 320 crore of that amount going to the BJP.

Later, following an ED probe into money laundering charges against the company in 2019, a group firm, MKJ Enterprises, donated Rs 14.4 crore to the BJP.

The Keventer group faced ED action again in February 2021, following which MKJ Enterprises donated Rs 22.4 crore in bonds, this time to the TMC.

It should be noted that the Congress also received Rs 91.6 crore in bonds from Keventer, following the initial ED probe in 2019.

Vedanta

Bonds purchased before action: Rs 52.65 cr

Bonds purchased after ED action: Rs 347.7 cr

Redemptions before action: BJP (Rs 52.65 cr)

Redemption after action: BJP (Rs 177.5 cr), Congress (Rs 125 cr), BJD (Rs 40 cr), JMM (Rs 5 cr), TMC (Rs 20 lakh)

ED action against Vedanta began in mid-2018, when the agency claimed that it had information on the group's complicity in the bribe-for-visa case involving Chinese nationals, and over three windows in 2019, the company donated Rs 52.65 crore to the BJP.

Three years later, in 2022, the ED began a money laundering into Vedanta, around which time the company again donated to the BJP, amounting to Rs 176.5 crore over the course of the year and accounting for 77 per cent of its donations to the saffron party.

Out of the total sum of Rs 400.35 crore spent on bonds since April 2019, 57.5 percent was directed towards the BJP. The second largest beneficiary was the Congress, which received Rs 125 crore, followed by the BJD, which got Rs 40 crore.

Haldia Energy

Bonds purchased before action: Rs 22 cr

Bonds purchased after ED action: Rs 355 cr

Redemptions before actio: BJP (Rs 16 cr), TMC (Rs 6 cr)

Redemptions after action: TMC (Rs 275 cr), BJP (Rs 65 cr), Congress (Rs 15 cr)

The CBI in 2020 booked Haldia Energy and other mining giants in a case of alleged corruption of causing a loss of Rs 100 crore to the Mahanadi coalfields.

While the company invested a total of Rs 377 crore in electoral bonds from 2019 to 2024, interestingly, Rs 355 crore of this came following the CBI's FIR. It should be noted that Haldia Energy belongs to the RPSG Group, which donated a total of Rs 584 crore in electoral bonds via its eight subsidiary firms.

Haldia Energy also donated to several parties before and during the West Bengal Assembly elections in the summer of 2021: while it gave Rs 20 crore to the TMC and Rs 17 crore to the Congress prior to the polls, it donated Rs 35 crore to the saffron party during the state polls.

After the polls, the only beneficiary of Haldia Energy's bond purchases was the BJP, which received funds worth Rs 30 crore between April 2022 and January 2023.

Jindal Steel and Power

Bonds purchased before action: 0

Bonds purchased after ED action: Rs 123 crore

Redemptions: BJD (Rs 100 cr), Congress (Rs 20 cr), BJP (Rs 3 cr)

Although Jindal had faced probes by central agencies related to the coal blocks allocation case, the firm found itself at the end of an ED raid in April 2022, which brought fresh charges against the company and its promoter Naveen Jindal for forex violations.

The company began purchasing electoral bonds shortly afterwards, buying its first bonds in October 2022, and subsequently in 2023.

The BJD was the biggest beneficiary of Jindal's purchases, and received Rs 100 crore over the course of 2022 and 2023.

In November 2023, Jindal also donated Rs 3 crore to the BJP. However, other Jindal Group started buying bonds in April 2023, and a total of Rs 72.5 crore of the same was received by the BJP.

In March 2024, Naveen Jindal joined the saffron party and has assumed the charge as the President of Indian Steel Association.

DLF

Bonds purchased before action: 0

Bonds purchased after ED action: Rs 170 cr

Redemption: BJP (Rs 170 cr)

The CBI raided the company's offices on January 25, 2019, in connection with alleged irregularities in the allocation of land. Months later, DLF first purchased its bonds in October 2019 and donated Rs 25 crore to BJP. In January 2020, it donated Rs 15 crore more to BJP, and a total of Rs 130 crore in tranches in April 2021 and November 2022.

Although the ED searched DLF's offices in Gurugram again in November 2023, the company did not make any donations to the BJP over the course of 2023 and 2024.

Yashoda Super Specialty Hospitals

Bonds purchased before action: 0

Bonds purchased after ED action: Rs 162 crore

Redemptions: BRS (Rs 94 cr), Congress (Rs 64 cr), BJP (Rs 2 cr), AAP (Rs 1 cr), YSRCP (Rs 1 cr)

Multiple premises of Hyderabad-based Yashoda Super Specialty Hospitals were raided in December 2020 by the I-T Department, but the company made no electoral bond purchases that year.

However, in October 2021, the firm made large donations, with the BRS getting the lion's share, worth Rs 94 crore. The Congress was the second largest beneficiary, and received Rs 64. The BJP, meanwhile, got Rs 2 cr.

Chennai Green Woods

Bonds purchased before action: 0

Bonds purchased after action: Rs 105 crore

Redemptions: BRS (Rs 50 cr), TMC (Rs 40 cr), Congress (Rs 15 cr)

The Ramky Group, in July 2021, was subject to I-T Department raids.

Subsequently, in January 2022, the construction firm of the group donated Rs 40 crore worth of bonds to the TMC. This was followed by a Rs 50 crore donation to the BRS in April 2022.

In October 2023, the firm also donated Rs 15 crore to the Congress, just before it came to power in the Telangana, where the headquarters of the group is located.

Hetero Pharma

Bonds purchased before action: 0

Bonds purchased before action: Rs 60 crore

Redemptions: BRS (Rs 50 crore), BJP (Rs 10 crore)

The I-T Department tracked some unaccounted income of Rs 550 crore and seized over Rs 142 crore cash October 2021 in a raid.

Subsequently, in April 2022, Hetero Pharma, specifically, three companies of the group, bought bonds worth Rs 60 crore between between April 2022 and October 2023.

Rs 50 crore went to the BRS, while the BJP received Rs 10 crore.

NCC

Bonds purchased before action: 0

Bonds purchased before action: Rs 60 crore

Redemptions: BJP (Rs 60 crore)

The I-T Department conducted searches on NCC properties for suspected tax evasion in November 2022, notably then Nagarjuna Construction Company (NCC) purchased bonds worth Rs 60 crorein October 2019 and October 2022, all redeemed by the BJP.

Divis Labs

Bonds purchased before action: 0

Bonds purchased before action: Rs 55 crore

Redemptions: BJP (Rs 30 crore), BRS (Rs 20 crore), Congress (Rs 5 crore)

Following a 2019 I-T Department raid on the premises of Divis Laboratories, a global leader in API manufacturing, the company purchased two tranches of electoral bonds worth Rs 55 crore in 2023, of which Rs 30 crore went to the BJP and Rs 20 crore to the BRS.

Welspun

Bonds purchased before action: 0

Bonds purchased after action: Rs 55 crore

Redemptions: BJP (Rs 30 crore), BRS (Rs 20 crore), Congress (Rs 5 crore)

Welspun had faced an ED probe over a forex violations case and had been slapped with a Rs 55 crore penalty in 2013. It had also faced an I-T Department raid in 2017.

Well-over a year after the I-T raid, the Welspun Group in 2019 started purchasing bonds through various sister entities, as reported by IE: in 2019, it gave Rs 8 crore to the Congress, while in November 2023, it gave Rs 5 crore to the BRS.

The rest of its donations—Rs 42 crore—went to the BJP, which redeemed Rs 30 crore in November 2022, and the rest between January 2020 and April 2022.

Ramco Cement

Bonds purchased before action: 0

Bonds purchased before action: Rs 54 crore

Redemptions: BJP (Rs 25 crore), YSRCP (Rs 24 crore), TDP (Rs 5 crore)

While Ramco did not face any raids by the ED or the I-T Department, it did face searches on its premises by the Competition Commission of India (CCI) in December 2020, on charges of price cartelisation.

Two years after the fact and up until November 2023, the firm purchased Rs 54 crore worth of bonds: the first batch of the purchases, worth Rs 5 crore, went to the TDP, while the YSRCP received Rs 24 crore. The BJP, meanwhile, was the biggest beneficiary, getting funds worth Rs 25 crore.

Aurobindo Pharma

Bonds purchased before action: Rs 22 crore

Bonds purchased after action: Rs 30 crore

Redemptions before action: BRS (Rs 15 crore), BJP (Rs 4.5 crore), TDP (Rs 2.5 crore)

Redemptions after action: BJP (Rs 30 crore)

The ED in November 2022 arrested Aurobindo Pharma's director P Sarath Reddy in the money laundering probe related to the then Delhi excise policy. Aurobindo, before Reddy’s arrest, had given donations worth Rs 3 crore to the BJP in January 2022 and Rs 1.5 crore in July 2022.

After Reddy's arrest in November 2022, however, the BJP received an additional Rs 5 crore from the firm. The saffron party received another Rs 25 crore a year later, after a Delhi court allowed him to turn approver.

The company's total donations to the BJP amounted to Rs 34.5 crore, while the TDP and the BRS received Rs 2.5 crore and and Rs 15 crore respectively.

Rithwik Projects

Bonds purchased before action: 0

Bonds purchased before action: Rs 45 crore

Redemptions: Congress (Rs 30 crore), JD(S) (Rs 10 crore), TDP (Rs 5 crore)

The I-T Department raided premises associated with the company and its owner C M Ramesh, who was then a TDP, MP in October 2018, alleging the company had siphoned Rs 100 crore. Months later, the owner, Ramesh joined the BJP.

Of its total bond purchases worth Rs 45 crore, Rs 5 crore was given to the TDP in January 2023, Rs 10 crore for the JD(S) in April 2023, and Rs 30 crore for Congress in April 2023.

Shirdi Sai Electricals

Bonds purchased before action: 0

Bonds purchased before action: Rs 40 crore

Redemptions: TDP (Rs 40 crore)

Following I-T raids on its offices in Kadapa, Andhra Pradesh in December 2023, Shirdi Sai Electricals bought bonds worth Rs 40 crore in the immediate next purchase window in January 2024, all of which went to the TDP, which struck a recent alliance with the BJP to fight the Lok Sabha and Assembly polls jointly.

Ultra Tech Cement

Bonds purchased before action: Rs 15 crore

Bonds purchased before action: Rs 20 crore

Redemptions before action: BJD (Rs 10 crore), BJP (Rs 2 crore), Shiv Sena (Rs 3 crore)

Redemption after action: BJP (Rs 20 crore)

Ultra Tech Cement first bought Rs 5 crore worth of bonds in October 2019, of which Rs 2 crore went to the BJP and the remaining to the (then intact) Shiv Sena. It also gave Rs 10 crore to the BJD in October 2020.

Months later, the firm faced a CCI search, following which it exclusively donated to the BJP funds worth Rs 20 crore in two separate, equal batches

Mankind Pharma

Bonds purchased before action: Rs 24 crore

Bonds purchased before action: 0

Redemption: BJP (Rs 24 crore)

The I-T Department conducted raids on the premises of Mankind Pharma in Delhi and nearby areas over allegations of tax evasion in May 2023. In November 2022, it had reportedly given donations worth Rs 24 crore to the BJP.