Kerala High Court grants relief to Thomas Isaac in masala bond case probe

Kochi: Former Kerala Finance Minister T M Thomas Isaac, who is contesting the Lok Sabha elections, received relief from the Kerala High Court on Tuesday in connection with the Enforcement Directorate probe into the KIIFB masala bond case.

The court directed the ED not to summon Isaac during the election period.

This directive came in response to Isaac's plea challenging ED's actions.

While examining documents presented by the ED, the court noted that Isaac would need to address certain matters.

The court scheduled a detailed hearing for May 22 on the pleas filed by Isaac and the Kerala Infrastructure Investment Fund Board (KIIFB) in connection with the ED investigation into the case.

Previously, Isaac's plea regarding ED's summons for April 22 was postponed by the court.

However, as Isaac received fresh summons, he approached the court again seeking relief.

The Enforcement Directorate (ED) issued summons to the senior Kerala CPI(M) leader for questioning in a FEMA case linked to the probe into alleged violations in the financial dealings of KIIFB during his tenure as the finance minister in the previous LDF government.

Earlier, the 71-year-old politician was asked to depose at the agency office in Kochi on multiple occasions, but Isaac challenged it in the high court.

The Central agency informed the Kerala High Court in December last year that it had withdrawn the summons issued to Isaac.

The submissions were made during the hearing of a plea by Isaac and a KIIFB official alleging that only personal information was sought through the summons by the ED and seeking quashing of the same.

In view of the agency withdrawing the summons, the HC disposed of the petitions but at the same time, the court also said the ED was free to continue with its investigation in the matter.

Fresh summons to Isaac were issued in light of the HC allowing the agency to go ahead with the investigation, under the provisions of the Foreign Exchange Management Act (FEMA), into the end use of Rs 2,000 crore raised by KIIFB through masala bonds and its compliance with the FEMA norms.

KIIFB is the primary agency of the state government for financing large and critical infrastructure projects and had raised Rs 2,150 crore in 2019 through its debut masala bond issue as part of its plan to mobilise Rs 50,000 crore to fund large and critical infrastructure projects in the southern state.

The ED suspects contravention of FEMA here and hence initiated a probe.