New Delhi, Sept. 24: The department of company affairs (DCA) today said its report on accusations that Modi Xerox bribed government officials in pushing sales in India would be submitted soon.
Although company affairs secretary M. M. K. Sardana refused to comment on the contents of the report, sources alleged the report is likely to stir up a major controversy in corporate circles and force further changes in accounting standards, which were tightened in the wake of the Xerox scandal.
Sardana also said his department was going through a voluminous report prepared by former commerce minister Subramaniam Swamy alleging fund diversion of over Rs 7,000 crore by the Reliance group companies to various front firms by using stratagem such as sale of assets at low prices, grant of bogus incomes, purchase of assets at inflated prices, and issue of securities through the 1990s.
Finance minister Jaswant Singh, who was presented the report on May 19, had directed DCA to carry out “a detailed examination of the issues”.
“We have no intention of harassing Reliance but we are looking into the new issues. If required, we will take action,” Sardana said.
Officials said US-based Xerox had earlier shared information on bribes paid to government departments by its Indian joint venture with the B. K. Modi group on sales of office equipment worth over $100 million over the last decade.
The DCA had on the basis of this information asked a chartered accountant firm S.K. Jain & Co to start a probe last July.
Though the department enjoys the right to outsource probes, this was the first time it had done so, mainly because the accused were all government establishments. The CA firm has interviewed 400 witnesses and screened books of accounts pertaining to the period when bribes are supposed to have been paid. It needs to interview a few foreign witnesses before it rounds off its report.
Top government officials said once this report was out, “action would follow.” Sardana said more investigations would be outsourced despite the fact that a serious frauds office will start probes on a number of cases soon.