Vinod Rai 'censured' by RS panel

As finance secretary he had appointed a junior as IFCI CEO-MD

GN Bureau | December 14, 2011



Comptroller and Auditor General Vinod Rai is immune to any action since he is a constitutional authority and yet a parliamentary panel on Wednesday virtually censured him for the haste with which he got a junior appointed as the managing director and CEO of the Industrial Finance Corporation of India (IFCI) in 2007. He was then the finance secretary.

A Rajya Sabha Committee of Privileges headed by BJP leader SS Ahluwalia, in its report tabled in the house on Tuesday, recommended an inquiry into the "undue favour" shown in the appointment of Atul Rai as the IFCI chief and that too within 24 hours of his voluntary retirement.

Also see: Parl panel wants CBI probe into IFCI chief's appointment


It sought a separate probe into the "facts that point towards a definite collusive effort on the part of joint secretary and secretary to accord undue favour to Rai." CAG Vinod Rai was the finance secretary when the appointment was made. The committee expressed "amazement" at the "swiftness with which the file moved among the higher-ups" in the finance ministry and views of other ministries collected to secure approval by the then finance minister.

The issue of the appointment of the IFCI chief was not at all listed before the privilege committee asked to probe his alleged misbehaviour with former union minister and BJP MP Rajiv Pratap Rudy, but it tumbled upon the fishy way he got the post to let it probe further.

The committee noted how the vital decisions were taken between May 30 and June 1, 2007. Rai got the coveted post within 24 hours of his voluntary retirement to be eligible for appointment as the rules lay down that only a pensioner can take up the job. Approval of his voluntary retirement and granting him permission to take up the IFCI CEO job happened within 24 hours.

The report points out that Rai was just a director, a junior post in the Finance Ministry, and dealt with the matters concerning the financial institutions, including IFCI. He was also the government nominee director on the board between August 2005 and May 2007 until his camouflaged voluntary retirement to take up the lucrative posting.

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