Govt moves against ED; MLA Swaraj to issue infringement notice on masala bond


The ED move was on the basis of the CAG report that Kerala violated the rule which hinders states from taking foreign loans, through the masala bond.

M Swaraj with chief minister Pinarayi Vijayan | Photo: Aji V K | Mathrubhumi

Thiruvananthapuram: The government is planning to issue an infringement notice in the assembly against the Enforcement Directorate (ED) regarding the investigation into masala bond. The notice was served on the basis of the assumption that the ED investigation into the matters in the report before its submission in the assembly is an infringement on the rights of the assembly.

An MLA from the ruling wing will approach the Speaker on behalf of the government. MLA M Swaraj will issue the notice, said the sources from finance department. The ED move was on the basis of the CAG report that Kerala violated the rule which hinders states from taking foreign loans, through the masala bond.

The ED suspects violation of the Foreign Exchange Management Act (FEMA) in this move. So, they also sought explanation from the Reserve Bank of India (RBI). In the next phase, ED can ask for files from KIIFB and from the finance department. CAG had observed that the RBI's permission for masala bonds was suspicious.

The infringement notice against the ED for requesting the files of Life Mission project is under consideration of the Ethics Committee. The committee has asked for an explanation regarding how the ED's response was leaked to the media. Unlike requesting files, probe into a report which is yet to be submitted in the assembly is suspicious, the government assume.

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