Messi row: Kerala CM directs Home Dept to form SIT for comprehensive probe

The Office of the Kerala Chief Minister has given the nod to form a Special Investigation Team (SIT) to probe the alleged irregularities in the failed plan to bring the Argentina football team to Kerala. Sources in the CMO, Kerala, said that the file recommending the formation of the SIT has been forwarded to the Home Department.

"The recommendation was made after considering the findings of the report submitted by the Special Secretary, Department of Sports, N Prasanth. The probe will cover all aspects, including violations of service rules, the financial code, and other violations pointed out in the report. It will also look into the renovation works undertaken at the Kaloor stadium," said an official with the CMO, Kerala.

The Home Department will now issue an order constituting the SIT members. The order will also lay down the terms of investigation.

The government had earlier formed an SIT under the State Goods and Services Tax department (GST) following complaints of tax evasion of serious nature by the Reporter Broadcasting Corporation (RBC).

The SIT under the GST department has submitted a preliminary probe report which has confirmed intentional delay by certain officials allegedly under political pressure in processing the files related to the demand notice slapped on the RBC. An official associated with the probe said that the demand on reverse charges associated with the import of services was delayed by a few GST officials.

Along with this finding, other recommendations have been submitted in the preliminary probe report. The GST department has also issued notices to two financial institutions which transferred ₹206 crore to the RBC as part of making the required payments to the Argentine Football Association. Sources said that while one institution has responded to the notice, the department has asked it to furnish additional documents for more clarity. Another institution, which received the notice, has reportedly communicated to the GST department that it would present the documents this week. The GST is also looking into the reverse charges due for the legal fees paid by RBC as part of an ongoing case in the tribunal for return of money paid to AFA.

The inquiry report of the Special Secretary N Prasanth has recommended Vigilance and central agency probes into possible violations of foreign exchange regulations and money laundering laws. The Enforcement Directorate (ED) has also registered a case under the Foreign Exchange Management Act (FEMA) against RBC over the offshore financial remittances made as part of organising the football match in Kerala.

The Special Secretary's report flagged violations of the Secretariat manual, Kerala Financial Code, Store Purchase Manual and mandatory regulatory violations in foreign remittance. The report said that the foreign remittance of ₹126 crore through a third-party foreign intermediary was done without any background examination and it exposed the government to substantial income tax, FEMA and ED scrutiny.

It called for a comprehensive probe considering the criminal, financial and regulatory dimensions involved in the deal. It was cited that the decisions regarding the match were not taken at the level of the officers of the Sports Department in the Secretariat and that other decisions were made as per notes by the then Private Secretary of the former Sports Minister Abdurahiman.