India Today’s headline is blaring wrong. The richest Lok Sabha MP in India is NOT Jagan but Sonia Gandhi.
See: Sonia Gandhi: World’s Fourth Richest Politician
How Jagan Reddy became the richest Lok Sabha MP in India, and what is his real worth?
A SRINIVASA RAO | Hyderabad, May 28, 2012 | 20:54
Jaganmohan Reddy, the YSR Congress president and the richest Lok Sabha member in the country, was on Monday remanded to judicial custody till June 11 by a special court in Hyderabad.
The 40-year-old MP, who had declared his personal assets at Rs 365 crore while contesting the by-elections to the Kadapa Lok Sabha seat last year, was arrested by the Central Bureau of Investigation (CBI) on Sunday in connection with the alleged disproportionate case.
Jagan was sent to Chanchalguda jail, which had lodged high-profile offenders such as Satyam Computers founder-chairman B Ramalinga Raju and mining tycoon Gali Janardhan Reddy, besides senior IAS officers B P Acharya and Y Srilakshmi.
On Monday morning, the CBI produced Jagan before the principal judge for CBI court A Pullaiah and sought 15 days of custody to elicit more information from him in the case. Senior CBI counsel Ashok Bhan said Jagan had not cooperated with the investigation agency during the three-day questioning. “He can no longer masquerade as a victim of the CBI probe. He has hoodwinked the people of a huge sum of money. We will now show the people about his swindling of money,” the counsel said.
The judge dismissed the plea for CBI’s custody of Jagan for further interrogation. In his order, Justice Pullaiah said the accused had the stature and position to influence the witnesses and to tamper with evidences and hence, it would be better he be sent to judicial remand under section 309 of CrPC.
The CBI counsel pointed out that there were investments in his companies to the extent of Rs 1,234 crore. “Jagan himself got enriched enormously in a short span of four years after influencing his father, the late Y.S. Rajashekhar Reddy, the then chief minister of Andhra Pradesh, in getting ill gotten money into his own firms from investors who doled out favours as part of quid pro quo,” the counsel alleged.
It is more or less a rags-to-riches story for Jagan in the last eight years. His assets had grown multi-fold during this period. As per the income tax returns submitted by his father Y.S. Rajasekhara Reddy before 2004 elections, the assets in the name of Jagan, who was then yet to enter politics, were worth just Rs 9.18 lakh. The total value of family assets declared by YSR during the 2004 elections was only Rs 50 lakh.
During 2008-09, Jagan had paid Rs 2.92 lakh tax for the entire financial year. While entering the electoral battle for the first time in April 2009, Jagan had declared that he possessed assets worth Rs 77.40 crore, including Rs 21 crore as part of his share in the ancestral property, including agriculture and non-agriculture lands at Idupulapaya and Kadapa, besides houses in Hyderabad, as inherited from his father YSR.
By May 2011, when he contested the by-elections to Kadapa Lok Sabha seat, he declared his assets before the Election Commission valuing at Rs 365 crore, besides another Rs 41.33 crore in the name of his wife Y Bharati.
His rivals say what Jagan had declared was just peanuts compared to the enormous wealth he possesses. Minister for health D L Ravindra Reddy, who had contested against Jagan in the May 2011 by-elections in Kadapa, said Jagan’s palatial bungalow at Yelahanka on the outskirts of Bangalore itself costs Rs 400 crore. The bungalow, built on 31 acres of land, has ultra modern facilities such as helipad, fountains and gardens. He has a similar posh bungalow at Jubilee Hills in Hyderabad, though not of the same opulence as his Bangalore palace. “How can Jagan claim that the total value of his assets is Rs 365 crore, when his single bungalow costs Rs 400 crore?” he asked.
According to TDP legislator and spokesman Varla Ramaiah, the value of his assets runs into several thousand crores, if one were to go by the value of the shares held by Jagan in his companies at the rate he had sold to others. “For example, while setting up Bharati Cements, Jagan raised the resources by allotting shares to various high-profile companies such as India Cements and Dalmia Cements at a high premium of Rs 1,440 per share even before the company started its manufacturing. Going by this rate, the total value of the shares held by Jagan and his family members in this cement company were worth Rs 6,650 crore those days,” Ramaiah said.
In April 2010, Jagan sold 51 per cent of the stake in Bharati Cements to French cement major SA des Ciments Vicat at an approximate value of Rs 2,500 crore.
In fact, Jagan started off with real estate projects in Bangalore and Hyderabad in the late 1990s. His first business venture was Sandur Power Company Limited, a defunct power project that he acquired from its original promoter M B Ghorpade in 2001 with an initial paid up capital of Rs 53.51 crore. The real turn around came after 2004 when his father became the chief minister.
In 2005, Jagan brought in Rs 124.60 crore investments into SPCL from two Mauritius-based companies — 2i Capital and Pluri Emerging Company. Subsequently, he floated some more companies such as Sarawati Power and Infrastrucuture Limited, Silicon Infrastructure Limited and Caramel Asia Holdings, which bought shares in Sandur at a low price and then sold them at higher rates to various industrial houses such as India Cements, Lanco group, GR Intrachem, Pioneer Infra, Pennar Cements, Hetero Drugs, Aurobindo Pharma, Indu projects etc.
The amount thus raised was invested in floating two other subsidiaries — Jagati Publications, which launched Sakshi Telugu daily in February 2008, and Indira Television, which launched Sakshi TV channel in October 2008. All thhe investors who invested in Sakshi were allegedly rewarded with various infrastructure projects, irrigation contracts and Special Economic Zones.
Simultaneously, Jagan also floated Raghuram Cements, which was later renamed as Bharati Cements. Besides, Jagan allegedly has benami investments in real estate in Bangalore and also in Brahmani Steels, which was set up in Kadapa by mining tycoon Gali Janardhan Reddy. It was suspected that he also had connections with disgraced companies Satyam Computers Limited and Maytas Infra, but the allegations have not been proved.
The CBI suspects that Jagan was also a beneficial owner of Asia Infrastructure Sicar, a Luxembourg-based company, and that certain investments were routed through this company into SPCL. It has also alleged that Jagan had floated several “briefcase companies” through which he had routed the black money into his media ventures.