KIIFB 'masala': ED summons Thomas Isaac 2nd time in 3 weeks

Thomas Isaac. File photo

The Enforcement Directorate (ED) has issued a summons to Kerala's former Finance Minister Thomas Isaac for questioning over the financial dealings of the Kerala Infrastructure Investment Fund Board (KIIFB).

It is the second time in three weeks that Isaac has been served a notice by the ED.

During the first Pinarayi government, when Isaac handled the finance portfolio, he was also the vice-chairman of KIIFB, which comes under the state government.

Isaac had failed to appear for questioning on July 19 claiming he had a series of lectures at the EMS Study Centre. In response to the earlier summons, Isaac put out a lengthy Facebook post.

Isaac had criticised the ED, labelling it as a political tool of the BJP-led Centre.

The veteran CPM leader has maintained that the ED was wrongly accusing KIIFB of violating the regulations under Foreign Exchange Management Act (FEMA) over the issue of 'masala bonds'.

Masala Bonds, issued to fund infrastructure projects, is transacted in rupees and is issued outside the country by Indian entities.

In May 2019, Kerala Chief Minister Pinarayi Vijayan had famously opened the KIIFB masala bonds trade at the London Stock Exchange.

"The Enforcement Directorate is a central agency that investigates black money and FEMA rules violations. The allegation is that there were FEMA violations in the issuing of masala bonds by KIIFB. The first argument is that the state government has no right to issue masala bonds. It is right that the state cannot issue masala bonds. But KIIFB is not the state government. It is a 'body corporate'," Isaac had mentioned in his post last month.

He had then summed up his post by saying the party would decide the rest. It is not clear if Isaac would appear for questioning on the latest summons.

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