Madras HC orders CBI inquiry into alleged scam during Senthil Balaji’s tenure

Chennai: In a setback to the outgoing DMK dispensation, the Madras High Court on Wednesday ordered an investigation by the Central Bureau of Investigation (CBI) into allegations of a Rs 397 crore scam in procuring distribution transformers during the tenure of V Senthil Balaji as the Minister for Electricity from 2021 and 2023.

The first bench of Chief Justice S A Dharmadhikari and Justice G Arul Murugan pronounced the orders on a writ petition filed by Arappor Iyakkam, an anti-corruption NGO, seeking a direction to the Directorate of Vigilance and Anti-corruption (DVAC) to register a case.

The judges, after hearing both sides, ordered a CBI investigation into the alleged scam and directed the DVAC to handover all files connected with the case to the officer in charge of investigation to be appointed by the Central agency within two weeks.

In its petition, the NGO said it analysed 10 tenders floated between 2021 and 2023 for the procurement of 45,800 distribution transformers, whose value of is Rs 1,182.88 crore.

Arappor Iyakkam said that in seven of the 10 tenders, there was clear evidence of unjust enrichment to the contractors through collusive bidding and cartelisation and resultant loss to the tune of Rs 397 crore.

The NGO sought registration of a case against Senthil Balaji, who is out on bail in a case filed against him by the Enforcement Directorate (ED) in connection with a cash-for-jobs scam during his tenure as Transport Minister during the 2011-2016 tenure of the AIADMK government.

The judges on Wednesday also asked the CBI to conclude the investigations as expeditiously as possible and contended that the observations made by them in the order were only with respect to the necessity of investigation by an independent agency and should not affect the merits of the case.

In his reaction, Senthil Balaji said there was no loss to the exchequer and there were no irregularities in awarding the contracts to procure transformers.

The order is a serious setback to the DMK dispensation and Senthil Balaji, one of the key strategists of the ruling party, especially in the western part of the state. The development comes close on the heels of the ED writing to the DVAC to file a FIR against Municipal Administration and Water Supply (MAWS) minister K N Nehru for allegedly receiving bribes to appoint people into key posts.

In the dossier, the ED had alleged a cash-for-jobs scam involving at least 150 of the 2,538 posts in the Municipal Administration and Water Supply (MAWS) department, with bribes between Rs 25 lakh and Rs 35 lakh per post. However, MAWS minister K N Nehru outright rejected the allegations levelled by the ED, saying every procedure laid out in the law, including written examination, was followed before selecting 2,538 people for various posts in the department.

Balaji, who joined the DMK in 2018 -- quickly emerged as one of the trusted lieutenants of Chief Minister M K Stalin. Stalin and almost his entire cabinet rushed to a government hospital where Balaji was admitted due to chest pain after he was arrested by the ED in a corruption case dating back to his days as AIADMK, reinforcing his importance within the DMK.

A grassroots worker and a diligent election strategist, Balaji was behind the selection of Ganapathi P Rajkumar, a former AIADMK mayor, as the DMK candidate from the Coimbatore constituency in the 2024 Lok Sabha elections to challenge the then BJP state chief K Annamalai.

Balaji is now contesting the elections from Coimbatore (South) by taking the battle straight into AIADMK-BJP bastion.