Former officials of Cognizant, L&T booked in Tamil Nadu bribe case

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Former officials of Cognizant, Larson & Toubro booked in Tamil Nadu bribe case
The company has been charged are under Section 120B of the Indian Penal Code (punishment of criminal conspiracy) and relevant sections of the Prevention of Corruption Act, 1988.

There have been various reports when senior officials of any company give bribes to get the tender or work done. In the recent one, a case has been registered against several former officials of Cognizant and Larson & Toubro.

The case was filed by Tamil Nadu’s Directorate of Vigilance and Anti-Corruption. The allegations were on the ground that bribe was paid to officials of the Chennai Metropolitan and Development Authority (CMDA).

The company has been charged under Section 120B of the Indian Penal Code (Punishment of Criminal Conspiracy) and relevant sections of the Prevention of Corruption Act 1988.

Background of the case

Cognizant was building its KITS campus at the special economic zone (SEZ) in Sholinganallur. The building was constructed between 2011-2016 and Larson & Toubro was its contractor. A bribe of Rs 12 crore was offered to the officials in 2014 for approval.

According to the Money Control reports the FIR states, “During the relevant period Cognizant also failed to devise and maintain a sufficient system of internal accounting controls at its corporate headquarters and at Cognizant India.”

“Cognizant voluntarily disclosed this misconduct to the Commission staff and timely shared the facts developed during the course of an internal investigation by the audit committee of its board”, the FIR added.

“Cognizant paid disgorgement of $16,394,351, prejudgement interest of $2,773,017, and a civil monetary penalty of $6,000,000 to the Securities and Exchange Commission, USA,” the FIR said.

How the matter arose

A was FIR registered for the planning permit. The planning permit is required before the starting of the construction starts. However, it was applied for by Cognizant on February 7, 2013. This was nearly 14 months after construction began. This file was then sent for approval to the government by the CMDA in November 2013. 

The time 40% of the construction was completed was approved by the minister on June 26, 2014. The initial file was sent to the office of the minister for housing and urban development on November 14, 2013.

Additionally, the authorities also found discrepancies in payments made by L&T to vendors and the amounts the company had claimed on bills.

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