Andhra Pradesh CID searches at ex-IAS officer house in Hyderabad

HYDERABAD: The AP Crime Investigation Department (CID) on Friday conducted searches at former IAS officer K Lakshminarayana's residence here in connection with alleged diversion of government funds to the tune of Rs 241 crore when he served as a director of Andhra Pradesh State Skill Development Corporation (APSSDC).

The Directorate General of GST Intelligence (DGGI), Pune, had earlier unearthed a fake invoices racket in which shell companies were utilised to divert funds through hawala transactions. In its FIR, the CID named the officials of APSSDC and directors of Siemens Industry Software (India) Private Limited (SISW) and DesignTech Systems Ltd.
The project of APSSDC involved setting up of six centres of excellence and 36 technical skill development institutions.
Money handed over through hawala transactions: CID
Sources said: "The estimated cost of the project was 3,356 crore. The technology partners would meet 90% of the cost of the project as grant-in-kind and that the state government had to invest 10% of the cost. Government orders were issued to the effect stating the objectives, cost estimates and 90%-10% splitting of cost between the technology partners and the AP government."
However, after the issue of GOs, a tripartite agreement was prepared in which it was mentioned that only the AP government would release 371 crore as a grant for SISW and DesignTech to set up skill development institutions.
"The release of 371 crore to the account of DesignTech was done in an express manner even before the skill development institutions were set up or the valuation of the work was done. Subsequent to the receipt of 371 crore with the connivance of the officials of the AP government and APSSDC, representatives of SISW and DesignTech siphoned off a major portion of the amount without providing commensurate goods and services," alleged CID.
Investigation done by DGGI in 2017-2018 found that 241 crore was misappropriated out of 371 crore given by the AP government. "This was done through utilisation of fake invoices provided by affiliated shell companies without providing other services. Money was drawn out of bank accounts and handed over to unknown persons through hawala transactions," alleged CID. CID alleged that project, supposed to be funded by technology partners, was converted into work order of 371 crore and given on a nomination basis in violation of the general financial rules and Central Vigilance Commission guidelines.