Telangana Chief Secy in the Dock After Government Alleges Irregularities in Formula E Race Agreement

Special chief secretary to the government of Telangana, Arvind Kumar, has been served a memo by the government to reply to charges of violations regarding the Formula E racing event in Hyderabad. Recently, the Formula E race scheduled to be held in February was cancelled after the new government allegedly did not honour the contract. Close on the heels of this, the IAS officer was served a memo asking him to explain why Rs 55 crore was paid from HMDA (Hyderabad Metropolitan Development Authority) funds even before the agreement was signed. The memo alleged that this was done without consulting the HMDA board of directors or the state finance department.

Apart from this, the officer was asked to furnish the explanations for the following within seven days:

1. Why the tripartite Long Form Agreement was entered with Formula E Operations (FEO) and a private organiser, without following the due process of approval
2. Why the consequences of dropping of the ‘promoter’ of the Season-9 agreement was not properly examined, including its financial implications, and necessary action was not initiated to claim the damages from the defaulting promoter
3. Why necessary due diligence was not done so as to safeguard the financial interests of the HMDA
4. Why a revised agreement with FEO was entered afresh for conducting the Season- 10 event, again without the competent authority’s permission, that too when the Model Code of Conduct (MCC) announced by the Election Commission of India (ECI) was in force in the state in the wake of announcement of schedule for general elections to state assembly.
5. Why the HMDA was designated as nodal agency to host as well as to conduct the event, without following the due process of approval from the competent authorities, as required under Secretariat Business Rules

The cancellation of the race had drawn flak from the Opposition. BRS leader K Taraka Rama Rao had called the decision regressive. He said that the BRS government had worked very hard to bring the international Formula E-prix for the first time in India.