Despite the repeated claims of Union Transport Minister and BJP leader Nitin Gadkari that he had not received any luxury automobile from Swedish company Scania for personal use, three media organisations on April 13, have reported that the company’s documents show otherwise.
According to the report by Sweden’s SVT, India’s Confluence Media and Germany's ZDF, the vehicle was given to a firm with alleged links to the minister with the aim of winning bus contracts in India between 2013 and 2016. Reportedly, the minister’s sons, Nikhil and Sarang Gadkari have also been found to be involved in the exchange.
Citing an audit by the Swedish automobile giant, the investigative report revealed details of an internal communication between Scania India officials in an email thread with the subject line, “Metrolink for Mr Gadkari”. The audit titled “Investigation into the alleged provision of a Luxury Bus to a Senior Public Official”, was conducted from December 2017 to October 2018, as per the report. It added that the auditors examined phones, emails and hard drives of Scania India executives and the information was later verified by forensic experts at KPMG Sweden.
The audit began with the aim of looking at misconduct which included “alleged bribery, bribery through business partners and misrepresentation”, the report quoted an official as saying.
Earlier in March, SVT, the Swedish public-television broadcaster had reported that Scania had delivered bus as a quid pro quo for bus contracts in seven Indian states. It had added that the vehicle was not completely paid for and was for use at Gadkari’s daughter Ketki’s wedding, which took place in Nagpur in December 2016 – a fact confirmed by CEO of Scania Henrik Henriksson.
The email correspondence examined by the audit revealed that Gadkari’s son Sarang began conversing with Scania India Sales Director Sivakumar Viswam in June 2015 and visited the Scania factory in Bengaluru accompanied by Viswam several times between June 2015 and December 2016, when the bus was ultimately delivered, the report said.
“According to sources at VW FS [Volkswagen Finance], it was their understanding that the bus was a gift by Scania India to a high politician, who is currently a minister, with the main purpose to get approvals for deals in India,” the audit stated. The loan valued at Rs. 2.18 crore was given by VW FS, which is a subsidiary of German vehicles manufacturer Volkswagen AG and a sister concern of Scania, to one of the companies used by the Gadkaris to acquire the bus, the report stated.
While there is no mention of any rewards being granted in exchange of the bus, the audit, however, states that “the bus constitutes a financial benefit, which was provided to Mr. Nitin Gadkari and/or his family members. The extent and value of the financial benefit should be subject to a legal assessment”.
According to the report, the audit also raised concerns about the usage of two companies by the Gadkari family and Scania India – the Nagpur-based Sudarshan Hospitality Management Private Limited and the Karnataka-based Transpro Motors Private Limited, respectively for the deal. Transpro reportedly bought the vehicle in August 2016, after being granted a loan by VW FS. It was then rented out to Sudarshan Hospitality in November 2016.
While the full rent and security deposit was never paid by Sudarshan Hospitality or the Gadkaris, Transpro Motors also began defaulting on the loan borrowed from VW FS, the report alleged. Following this, Scania India had to cover the cost of the loan as it had offered as the guarantor. The reported added that Scania authorities in Sweden or in India were not notified about this alleged transaction.
The email correspondence had also established that sales director Viswam had requested the Gadkaris to transfer the rent of the bus to Transpro Motors several times, the audit alleged.
Gadkaris’ Link With Sudarshan Hospitality
The authenticity of Sudarshan Hospitality has also been questioned by the audit report. The company started operations on June 9, 2015, around the same time that Scania and the Gadkari brothers had begun their email exchange regarding the bus. However, the report added, “Sudarshan Hospitality’s finances, as reflected in its MCA filings, were dismal. The company recorded a negative net worth throughout, at its lowest in FY20—with its liabilities exceeding its assets by a sum of Rs 10.48 lakhs. It has also consistently incurred losses, barring in FY17.” It signed the deal with Transpro Motors to rent the bus in 2017.
The contract required Sudarshan Hospitality to pay Transpro Motors an interest-free security deposit of Rs 1.2 crore. The report added that this would be refunded by the transport company at the end of the lease period of 36 months. Accordingly, three installments of Rs 40 lakh each were to be paid by the company beginning November 2016.
Notably, a network of companies connects Sudarshan Hospitality to Manas Agro and Cian Agro—the two flagship companies of the Gadkari sons, helmed by Sarang and Nikhil, respectively.
Sudarshan Hospitality had received an unsecured loan of Rs 35 lakh from Manas Agro Industries in 2016. It should be noted that Manas Agro is the same company where Sarang Gadkari has been a full-time director since June 15, 2016, the report said. Further, Nikhil Gadkari himself is an advisor and member of the management council of Manas Group, which owns Manas Agro.
The Caravan, one of the media organisations which have accessed the audit report, have raised several allegations regarding the nature of the transaction.
As per the report, “Nitin Gadkari is among the most powerful men in the Bharatiya Janata Party and in Prime Minister Narendra Modi’s cabinet. In his 2019 affidavit submitted to the Election Commission, he declared a combined income of Rs 54,58,390 earned by his wife, his Hindu Undivided Family account and himself, and total assets worth at least Rs 24 crore.” In addition, Sarang Gadkari’s Manas Agro recorded a net profit of Rs 9.64 crore in the financial year 2016-17, or FY17, when the bus was purchased, and Nikhil’s Cian Agro recorded a revenue of Rs 112.80 crore that year, Caravan added.
The Caravan report questioned, “If the Gadkaris did want the bus for Ketki’s wedding, as stated in the audit report, why did they not purchase it on their books with the wealth they have amassed? Why, instead, were they closely involved and consulted in all matters concerning the bus, but kept out of the official records of all the transactions?”
Meanwhile, there have been no comments by the Gadkaris and the associated companies on the alleged deal, as per the reports.