CBI today carried out searches in the premises of former top officials of MTNL and Noida-based HCL Infosystems for allegedly inflating the cost of setting up a broadcast network for the Commonwealth Games by nearly Rs 400 crore.

Soon after registering a new case, sleuths of the agency swooped down on the residential premises of MTNL's the then CMD R S P Sinha, Executive Director S M Talwar, GM (Corporate Sales) N K Jain and DGM Jitendra Garg in Delhi, Noida, Jaipur and Patna, CBI sources said.

"During searches conducted so far, documents relating to immovable and movable property belonging to accused persons and other incriminating documents have been recovered," CBI spokesperson Dharini Mishra said in a statement, adding searches were on at these places till late evening.

When contacted, Sinha said he was in office till January 9, 2010 during which only Letter of Intent was issued but there was no approval during his tenure. He said he was out of Delhi.

"Everything was approved by the Department of Telecommunication and MTNL Board after I left. Somebody wants to drag my name," Sinha told PTI.

The agency has registered the case for against officers of MTNL and HCL Infosystem dealing in Optical Fibre Transmission for criminal conspiracy and provisions of Prevention of Corruption Act.

"It is alleged that MTNL awarded the work of broadcast network based on IP/MPLS Technology at an exorbitant price of approximately Rs 570.12 crores by manipulating specifications in such a manner as to make them tailor made for the said bidder to the said private company (HCL)," Mishra said.

The agency alleged that initial estimate of broadcasting data transmission project for the sporting extravaganza was very limited with an initial estimate of Rs 31.43 crores but MTNL officials included a Broadcast Video Network based on IP/MPLS technology which resulted in cost escalation by Rs 380.04 crore.

The CBI alleged that this change in specification was done with an intention to cause huge pecuniary advantage to contract firm -- HCL Infosystems causing loss to exchequer, sources said.

"The enhancements in the scope of work and engineering of conditions of contract were made by the officials concerned of MTNL in such a manner that sub-contract could be awarded only to the said private limited company," Mishra said.

The High Level Shunglu Committee constituted by the Prime Minister has also criticised the project.

"MTNL was tasked with providing inter-connectivity between Games venues and the broadcasting centre at ITPO. Its costs were so high that a Working Group had to be constituted and costs were reduced to less than half of what had been proposed," the report had said.