Telangana serves memo to IAS officer over Formula E agreement

The Telangana government has served a memo to senior IAS officer Arvind Kumar for ‘serious violations’ with regard to the Formula E race agreement.

The memo has been issued in connection with the conclusion of agreements with Formula E Operations (FEO) for the conduct of Formula E racing events in its Season-9 and Season-10 in Hyderabad.

The official has been asked to explain why the huge financial expenditure of Rs 46 crore plus the tax amount of Rs 9 crore was paid from the Hyderabad Metropolitan Development Authority (HMDA) resources even before the agreement was signed.

According to the memo issued by Chief Secretary A. Santhi Kumari, the amount was paid without obtaining the concurrence of the HMDA’s Board of Directors as well as that of the Finance Department of the state government.

The officer has been asked to give an explanation in seven working days as to why suitable further action should not be initiated for the lapses.

Arvind Kumar was then Special Chief Secretary, Municipal Administration and Urban Development. After the Congress party came to power last month, he was transferred and posted as Special Chief Secretary, Revenue.

The memo was issued on January 6, the day when Formula E announced cancellation of the second Formula E race (Season 10) scheduled in Hyderabad for February 10.

The announcement was made after a decision by the Municipal Administration and Urban Development Department (MAUD) of the Telangana government not to fulfill the Host City Agreement signed on October 30, 2023.

Formula E Operations (FEO) said it was left with no choice other than to formally give notice to MAUD that it is in breach of contract.

The state government has asked Arvind Kumar to explain why the tripartite long-term agreement was entered with Formula E Operations (FEO) and a private organiser, without following the due process of approval from the competent authority, and in violation of Secretariat Business Rules.

“Why due permission was not taken, and the issue was not brought to the notice of the competent authority, when the tripartite agreement was terminated by the FEO, allowing the promoter, who was at gross default go free from any liability while the additional burden of conducting the event besides hosting the same was passed on to the government,” reads the memo.

He was also asked to explain why a revised agreement with FEO was entered afresh for conducting the Season-10 event, again without the Competent Authority's permission, that too when the Model Code of Conduct (MCC) announced by the Election Commission of India (ECl) was in force in the state in the wake of announcement of schedule for General Elections to State Assembly,” asked the memo.

He was also asked why the HMDA was designated as nodal agency to host as well as to conduct the event, without following the due process of approval from the competent authorities, as required under Secretariat Business Rules.

“While Article 299 of the Constitution of India provides that "all contracts made in the exercise of the executive power of the Union or of a State shall be expressed to be made by the President or by the Governor of the State", why a formal consent from the competent authority was not taken when a major policy decision involving huge financial commitment for conduct of the Formula E event in Season 10 as well as the commitment to conduct the event for next 2 seasons was committed,” it added.