Hyderabad: Telangana deputy chief minister Bhatti Vikramarka Mallu called the Formula E race a ‘failure’ and said that the state has incurred a budgetary loss of around Rs 110 crores for conducting the event.
“This significant financial impact raises concerns about the justification for spending such a large sum solely for a potential image boost. Additionally, there’s an issue with the Municipal Administration special chief secretary signing a file without the approval of the then municipal minister K T Rama Rao. The government is contemplating legal action due to non-compliance with the secretariat’s business rules,” he said.
He further said that the state government will verify the legal validity of the agreement entered into by the previous state government with the company and will proceed accordingly.
“There is no validity as the deal is entered into in violation of the secretariat business rules without informing the competent authority,” he added.
He also said that the state government has decided to proceed legally to recover the amounts paid to Formula E Organisers.
He also raised concerns about “the lack of due process” in entering into the agreements, including the tripartite agreement with Ace Nxt Gen and the advance payment of Rs. 55 crore.
Bhatti also raised questions on the financial implications and the “absence” of necessary due diligence.
The deputy chief minister also questioned the ‘public interest’ served by organizing the Formula E race and dismissed former minister KT Rama Rao’s claim that it had helped attract investments and business.
He asked the leaders of Bharat Rashtra Samithi (BRS) to cease “spreading misinformation” about the newly elected Congress government’s actions.
He accused the BRS of committing “economic atrocities” to benefit a specific group and stated that the individuals behind Ace Nxt Gen would be “disclosed very soon.”
Notice to Arvind Kumar
In its notice to MA&UD special chief secretary Arvind Kumar, the state government questioned the transactions of HMDA to Formula E before the signing of an agreement over the scheduled race.
A sum of Rs 55 crores, (46 crores plus 9 crores as taxes), was reportedly transferred by the HMDA, for the event.
The notice raised a question regarding the lack of action taken against the “promoter” of the Formula E race in Season 9, who was a gross defaulter. It also highlighted that the burden was borne by the government in Season 10 without any action being taken against the promoter.
The notice has alleged that the Telangana government signed contracts with Formula E for the race scheduled in Hyderabad, while the Model Code of Conduct (MCC) was in place, ahead of the November 30 Telangana Legislative Assembly Elections. Competent authorities were not consulted before designating HMDA as a Nodal agency to host and conduct the event.
The MoS has demanded a response from Arvind Kumar in seven days failing which suitable action would be initiated for the lapses in organising the Formula E race in Hyderabad, assuming that the officer is guilty and has no explanation in the matter.
