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 stay 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.

As the Serious Fraud Investigation Office, which is probing the financial dealings of Exalogic Solutions, the firm owned by Chief Minister Pinarayi Vijayan’s daughter Veena Vijayan, as well as the Cochin Minerals and Rutile Ltd (CMRL) and the Kerala State Industrial Development Corporation (KSIDC), began its probe with lightning speed, the Exalogic Solutions on February 8 approached the Karnataka High Court seeking to stay the Central probe agency’s 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 contention of the petitioner company, Exalogic Solutions, was that the Central government is under prohibition to order an investigation through SFIO under Section 212 of the Companies Act in the larger public interest when a prior probe, ordered earlier through the Inspectors of the Registrar of Companies (RoC) under Section 210 of the Act, has not reached its logical conclusion.

The Ministry of Corporate Affairs informed the Karnataka High Court that it ordered an investigation by the SFIO since the CMRL, engaged in sourcing beach sand minerals along the Kerala coast, had made illegal payments to the extent of Rs 135 crore to various political functionaries of Kerala state and certain other entities, including Exalogic Solutions. It directly affects the public interest, the ministry pointed out.

The investigation was not only ordered against Exalogic Solutions but also against the CMRL and the Kerala State Industrial Development Corporation, the Ministry of Corporate Affairs had told the court.

The Ministry of Corporate Affairs had also informed the court that once an investigation is entrusted to SFIO, all other probes into the affairs of the company cease. It also stated that the SFIO probe would not impact the functioning of Exalogic Solutions as the company had obtained dormant status in December 2022.

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 (CMRL) and the Kerala State Industrial Development Corporation Industrial, to the Serious Fraud Investigation Office. A six-member team is authorised to probe the matter, with Deputy Director M Arun Prasad as the investigating officer.

The Income Tax Interim Settlement Board has established that Rs 1.72 crore was given to Veena Vijayan’s firm, Exalogic Solutions, by the CMRL without rendering any services.