The Karnataka High Court has upheld the legality of the Serious Fraud Investigation Office (SFIO) inquiry into the dealings of Exalogic Solutions, the firm owned by Kerala Chief Minister Pinarayi Vijayan’s daughter Veena Vijayan (Veena T).

In a major setback to Kerala Chief Minister Pinarayi Vijayan’s daughter Veena Vijayan (Veena T), the Karnataka High Court on Friday dismissed the petition filed by her, seeking to quash the Serious Fraud Investigation Office (SFIO) probe into the financial dealings of her firm, Exalogic Solutions.

Justice M Nagaprasanna, who pronounced the verdict on the petition on Friday, said that a copy of the order would be released on February 17.

While dismissing the petition challenging the SFIO investigation into the company belonging to Veena Vijayan, the Karnataka High Court observed that it cannot shackle the hands of the central government.

“Section 210 does speak of a report, the report can be either interim or final, but it need not be the final report only. During an investigation under Section 210, if the Inspectors, out of serendipity come across information that would prima facie touch upon skullduggery and thereon necessity emerges to assign the investigation to a multi-disciplinary body like the SFIO, created under the Act, this court cannot put shackles on the hands of the central government, for such assignment. If it had been entrusted to any other agency outside the Act, it would have been a circumstance altogether different. It is entrusted to the SFIO which is created under the Act, i.e., in terms of Section 211 with elaborate functions under Section 212,” the single bench of Justice M Nagaprasanna observed.

The court said that the powers of SFIO are statutorily determined from sub-section (3) to sub-section (17) of Section 212 and for the conduct of investigation there is a procedure in place which need not require elaboration at this juncture.

“If the Union of India has thought it fit to entrust the investigation to the SFIO, owing to certain factors which have emerged during the conduct of the investigation under Section 210, and in public interest, this court in exercise of its jurisdiction under Article 226 of the Constitution of India would not by a stroke of pen, annul such opinion of the Union of India, unless it is contrary to the statute or the action is demonstrably arbitrary. Neither of the two is present in the case at hand, as the projection of the two, by the learned senior counsel for the petitioner is sans acceptance. Therefore, there is no warrant to interfere at this stage,” the court said.

As the SFIO, which is probing the financial dealings of Exalogic Solutions, the firm owned by Chief Minister Pinarayi Vijayan’s daughter Veena Vijayan, as well as Cochin Minerals and Rutile Ltd (CMRL) and Kerala State Industrial Development Corporation (KSIDC), began its probe with a lightning speed, the Exalogic Solutions on February 8 approached the Karnataka High Court seeking to stay the SFIO investigation against it. The firm’s petition also sought that the inquiry order dated January 31 of the Ministry of Corporate Affairs be quashed.

The Ministry of Corporate Affairs had on 31 January issued an order handing over the probe into the affairs of Exalogic Solutions, as well as Cochin Minerals and Rutile Ltd and Kerala State Industrial Development Corporation to SFIO. A six-member team has been authorised to probe the matter, with Deputy Director M Arun Prasad as the investigating officer.

The Income Tax Interim Settlement Board (ITISB) has found that Rs 1.72 crore was given to Veena Vijayan’s firm Exalogic Solutions by the CMRL without rendering any service.