Volkswagen scam: CBI files chargesheet

After a five-year long investigation, the CBI on Saturday finally filed a chargesheet in the Rs 11.67-crore Volkswagen scandal in Andhra Pradesh.

Last Updated: Sep 26, 2010, 00:04 AM IST

Hyderabad: After a five-year long
investigation, the CBI on Saturday finally filed a chargesheet in
the Rs 11.67-crore Volkswagen scandal in Andhra Pradesh and
exonerated former industry minister Botsa Satyanarayana who
was at the centre of the controversy.

The scandal surfaced in 2005 and landed the then Congress
government headed by late Y S Rajasekhara Reddy in trouble as
it was alleged that the government paid Rs 11.67 crore to
Vashishta Vahan Pvt Ltd through "dubious means" for setting up
a car manufacturing unit in the state.
All the Opposition parties had alleged that Satyanarayana
and his brother Murali Krishna were directly involved in the
scam.

Reddy had changed Satyanarayana`s portfolio. Bowing to
pressure from the Opposition, the government was forced to
order a probe by the Central Bureau of Investigation (CBI).

In the 150-page chargesheet filed in the XIV Additional
Chief Metropolitan Magistrate (ACMM) court, CBI named seven
persons as the accused, including Helmuth Schuster, a former
official of the German car maker, who have been charged under
Sections 120-B (Criminal Conspiracy) and 420 (Cheating) of
IPC.

The CBI in its chargesheet named seven accused persons
who entered into a criminal conspiracy and cheated the Andhra
Pradesh government for an amount of Rs 11.67 crore.

"Helmuth Schuster along with other accused persons
conspired and cheated Andhra Pradesh government by making them
believe that one Indian Company by name M/s Vashishta Wahan
Pvt Ltd is an Indian nominated Company of M/s Volkswagen AG
Germany and made Andhra Pradesh government participate in
Equity to the tune of Rs 11.67 crore (2 million Euros)," the
chargesheet said.
According to the chargesheet, Helmuth Wolfgang Schuster,
who has been named as accused No 1 in the case, was a member
of the board of Skoda Auto and also the chairman of Volkswagen
Pension Trust. He was the head of the Volkswagen Indian
Project and was conducting negotiations with Andhra Pradesh
government for setting up a car manufacturing unit in Andhra
Pradesh.

Accused No 2 Ashok Kumar Jain was the Indian
Representative of the Volkswagen and was appointed by
Volkswagen to assist them in the negotiations in the capacity
as chief advisor to the Volkswagen India Project.

According to the CBI, the state government negotiated
with Volkswagen AG Germany for setting up a car manufacturing
project in Andhra Pradesh in 2005 and a series of negotiations
were conducted by the officials of Andhra Pradesh government
with Helmuth Schuster and Ashok Kumar Jain.

Vashishta Wahan Directors Jagadeesh Alaga Raja and B K
Chaturvedi and Gayathri Rai, the sister-in-law of Jagadeesh
Alaga Raja are among the other accused persons. Joseph V
George, chairman of Garden City Educational Trust, Bangalore
also figures among the accused.

Schuster and Jagadeesh are absconding, while the rest
accused were arrested and are out on bail. An interpol notice
was also isued against Schuster.

The CBI said it had conducted the investigation in India
and abroad and during its probe Rs 5 crore out of the Rs 11.67
crores was recovered. The CBI also carried out probe in
Germany and Switzerland by sending Letter Rogatory and claimed
to have collected vital evidence showing the complicity of the
accused.
Though, the German car maker, subsequently offered to pay
back the sum of Rs 11.67 crore to protect its image, the then
chief minister refused to take the money till the CBI probe
was completed.

Subsequently, the German car maker set up its unit in
Maharashtra.

The case was registered based on a complaint lodged by
former Chief Secretary of Andhra Pradesh Mohan Kanda.

After filing the chargesheet, CBI Superintendent of
Police H Venkatesh told reporters that 59 witnesses were
examined so far in the case and 95 documents supporting the
chargesheet running into 3,000 pages has been filed in the
court.

Vashishta Wahan Directors Jagadeesh Alaga Raja and B K
Chaturvedi and Gayathri Rai, the sister-in-law of Jagadeesh
Alaga Raja are among the other accused persons. Joseph V
George, chairman of Garden City Educational Trust, Bangalore
also figures among the accused.
Schuster and Jagadeesh are absconding, while the rest
accused were arrested and are out on bail. An interpol notice
was also isued against Schuster.

The CBI said it had conducted the investigation in India
and abroad and during its probe Rs 5 crore out of the Rs 11.67
crores was recovered. The CBI also carried out probe in
Germany and Switzerland by sending Letter Rogatory and claimed
to have collected vital evidence showing the complicity of the
accused.

Though, the German car maker, subsequently offered to pay
back the sum of Rs 11.67 crore to protect its image, the then
chief minister refused to take the money till the CBI probe
was completed.

Subsequently, the German car maker set up its unit in
Maharashtra.

The case was registered based on a complaint lodged by
former Chief Secretary of Andhra Pradesh Mohan Kanda.

After filing the chargesheet, CBI Superintendent of
Police H Venkatesh told reporters that 59 witnesses were
examined so far in the case and 95 documents supporting the
chargesheet running into 3,000 pages has been filed in the
court.

PTI