The CBI has booked Arvind Mayaram, former secretary of department of economic affairs, and others on charges of agreeing to a contract with the UK-based De La Rue International Limited in 2004 for supply of security thread for Indian currency notes ignoring the fact that the foreign firm did not have patent rights for it.

After registering an FIR against former IAS officer on Tuesday, the CBI carried out searches in Delhi and Jaipur to probe alleged involvement of Mayaram and other officials of RBI and union finance ministry in irregularities in awarding the tender for currency printing.

Investigating a complaint dated February 14, 2017, filed by Raj Kumar, Joint Secretary and CVO, Department of Economic Affairs, Ministry of Finance, the CBI said the government entered into an agreement with M/s De La Rue for the supply of exclusive colour shift security thread for currency notes in the year 2004 for five years which was later extended four times till 2015.

The government authorised the RBI, which subsequently set up a sub-committee headed by then executive director PK Biswas to look into all the aspects, to enter into agreement for supply of exclusive security features for currency notes. It was stated in the preamble of the agreement that “De La Rue has developed an exclusive India-specific green to blue colour shift cleart test MRT machine readable security thread ..for use in Indian bank notes paper”. For that, the UK-based company has to have exclusive rights -- this too was inked in the agreement, as per the CBI FIR.

Mayaram is alleged to have not acted on two reports submitted in 2006 and 2007, including by the RBI, that the UK firm did not possess patent for security feature it claimed, charged the CBI. He never told former finance minister as well about it when he granted illegal extension to the contract.

“Enquiry further revealed that on 10.05.2013, the matter was brought to the notice of Arvind Mayaram, as secretary economic affairs that the contract agreement with M/s De L Rue had expired on 31.12.2012, therefore, extension cannot be granted legally,” said the agency.

Despite that he approved on June 23, 2013, another three years extension to the company. Mayaram also overruled the fact that extension cannot be granted without obtaining mandatory security clearance from ministry of home affairs. Previous three extensions from September 2009 to December 2012 were approved by then Finance Minister, stated the FIR.

The CBI alleged that signatory of contract agreement from De La Rue has received ₹8.2 crore from offshore entities apart from the remuneration paid by the firm.