S. Vaikundarajan of V.V. Minerals sentenced to three years in prison, MoEFCC official to five years in SEZ project bribery case

S. Vaikundarajan of V.V. Minerals.

A Delhi CBI Special Court has sentenced the controversial beach sand mining baron S. Vaikundarajan of V.V. Minerals to three years’ imprisonment and a fine of Rs.5 lakh under the Prevention of Corruption (PC) Act in a case involving the bribery of a senior official in the Union Ministry of Environment, Forest and Climate Change (MoEFCC). The bribery case was in connection with getting ‘terms of reference’ for environmental clearance for a mineral-based, products-specific Special Economy Zone (SEZ) project on an area of 166.665 hectare at Thiruvalampuram in Radhapuram taluk in Tirunelveli district of Tamil Nadu.

The Special Judge Nirja Bhatia of PC Act, CBI-3 at Rouse Avenue District Courts, New Delhi, delivered the sentence on February 22. Along with Vaikundarajan, who is the managing partner of V.V Minerals, the judge sentenced M. Subbulakshmi (Accused No.3), the firm’s liaison officer on contract basis, to three years’ imprisonment and Neeraj Khatri (Accused No. 1), a Deputy Director in the MoEFCC, to five years’ imprisonment. The judge remarked that Khatri was “habitually involved in offences falling under the purview of PC [Prevention of Corruption] Act for which he should be given enhanced punishment...”.

The judge also ruled that “since it has now concluded beyond shadows of all reasonable doubts..., I accordingly hold them guilty of the offences...”. The court also imposed a fine of Rs.2 lakh on Subbulakshmi and Rs.5 lakh on Neeraj Khatri. V.V. Minerals, which has been involved in beach mining in Thoothukudi and Tirunelveli districts of Tamil Nadu since the early 1990s, listed as Accused No.4 in the case, was fined Rs.10 lakh. The case was registered by the Central Bureau of Investigation on March 1, 2016, and filed on December 29, 2016. The trial was completed on January 19, 2021, and the accused were found guilty on February 1, 2021. Vaikundarajan was found guilty under Section 120 (B) of the IPC read with Sections 7, 11, 12, 13 (2) read with 13 (1)(d) of the Prevention of Corruption Act, 1988. Most of the sections of both the IPC and the PC Act under which Vaikundarajan was convicted were also used against Neeraj Khatri and Subbulakshmi.

The CBI had found out that Neeraj Khatri, then a Deputy Director (Scientist-C) in the MoEFCC, had accepted Rs.4.13 lakh via a bank draft, dated July 3, 2012, in favour of VIT University (Vellore), at the instance of Vaikundarajan, to get his son admitted in the university’s B.Tech (Mechanical Engineering) course. The CBI also charged that the air tickets for Khatri and his son from Delhi to Chennai and back were bought by Subbulakshmi.

As a token of reciprocation, the investigating agency claimed, Neeraj Khatri favoured V.V. Minerals by forwarding its letter and application dated October 15, 2012, to the Secretary of the MoEFCC, along with a form and a pre-feasibility report, seeking `Terms of Reference’ for environmental clearance of the firm’s SEZ project.

The application was submitted in the Ministry’s central registry and marked to Impact Assessment (IA)-III division, and an acknowledgement receipt was issued. A copy of the acknowledgement, the CBI alleged, was submitted by the company to IA-II section, where Neeraj Khatri was in charge, instead of IA-III Division, which was legally empowered to handle the application of such projects.

Neeraj Khatri endorsed the acknowledgement with a note saying that the project had “to be considered urgent” in the next “Expert Appraisal Committee (EAC) meeting in November”. The firm had received the Coastal Regulation Zone (CRZ) clearance for operations for the project in 2005-06. In May 2012, the Industries (MIE2) Department in Chennai recommended to the Commerce Ministry the grant of “formal approval” for the SEZ. The project proposal was approved by the Commerce Ministry on July 6, 2012.

In November 2018, the Income Tax Department carried out search operation against V.V. Minerals, and reportedly unearthed “undisclosed income to the tune of Rs.1,825 crore”, besides documents, leading to suspicion of huge tax evasion. The income tax sleuths also seized, during the raid against the group, cash to the tune of Rs.8.5 crore. About 100 locations across Tamil Nadu and Andhra Pradesh where the firm’s companies had operations were brought under the search operations.

V.V. Minerals, which has an annual output of 7,00,000 tonnes of heavy minerals, is India’s largest manufacturer and exporter of beach minerals.