Manipulated PF Allegations Against Hiranandanis

A press note and explaination issued by Hiranandanis:

The CBI raided the offices of Hiranandani Group in March 2008 based on the information given by the Provident Fund Department that there was a PF fraud then by the Hiranandani Group of an amount of Rs. 168 Crores. This was flashed in the electronic and press media and brought about a substantial amount of disrepute to the Hiranandani Group.

We were called by the investigation officers from time to time in the two years and must have visited the CBI offices at least 40 to 50 times and also submitted personal statements, documents, accounts and papers of at least 3000 pages.

The investigations were carried out by the CBI when it was conclusively proved that the figure of Rs. 168 crores was false and fabricated only for harassing the Group and for ulterior means and hence no further cognizance should be taken up on the matter and we were reliably informed that the facts from our end was corroborated by the papers submitted by our Company.

The PF department obviously being upset with the wrong lead given to the CBI have instigated the CBI to open a new angle to the case. They have agreed that there was a blunder on their part to make the wrong allegation about the Rs. 168 crores of cheating and hence has drawn a red herring by alleging that in the years 2003 to 2006 the Hiranandani Group did not pay the amount of Provident Fund of the sub-contractors which on a suo moto calculation by the PF department came to be Rs. 9.36 Crores.

How come the PF department claimed Rs. 168 Crores in 2006 and 2008 followed by a massive raid by the CBI and now PF admit that the calculation of Rs. 168 crores was a mistake.

It is well known that not a single builder in India has ever paid the provident fund liability of a contractor till 2006 and it is shocking that the PF department in order to protect its mistake is now making this allegation against Hiranandanis.

It is also a fact that the Nagpur Branch of the Bombay High Court had put a stay to the builders and contractors from paying the provident fund of the subcontractors up to March 2006. The Hiranandani case falls during this period.