The Maharashtra government has decided to form an inquiry committee to investigate alleged irregularities by engineering giant Larsen & Toubro, while redeveloping land at Powai in suburban Mumbai.

The corporate major has been accused of misusing the land, which was provided by the Maharashtra government for industrial use. The expressed purpose of land use has been converted from industrial to residential and commercial.

In the ongoing session of the State Legislature, the issue of misuse was raised by MLA Sunil Prabhu by raising a calling attention notice. Prabhu said that 10 residential towers of 24-storeys have been built by L&T on the industrial land provided by the government, which resulted in misappropriation of ₹400 crore. The company has violated the law by carrying out illegal construction. The acts were also in violation of the Urban Land Ceiling Act, Revenue and Development Control Rules, it is alleged.

Maharashtra’s Minister of State (Home) Ranjit Patil told the State Assembly that an officer of a rank of Principal Secretary will lead the investigation committee and its work will be completed in two months. After the investigation is completed, further action will be taken.

BJP MLA Ashish Shelar said the company had not taken the required permissions from the Municipal Corporation of Greater Mumbai. It has also not abided by the District Collector’s order to stop the construction.

The company, in a media statement, has denied the charges. It said the real estate development has been made on a freehold land after receiving all permissions . It owns two types of land at Powai. One parcel of land has been allotted by the government for industrial use and the same continues to be utilised for industrial purposes.

The other set of land was purchased by L&T from private parties and is freehold land. Residential development is being carried out on part of this freehold land, after obtaining due approvals from the government and municipal authorities, the statement said.