The story so far

Cochin Minerals and Rutile Ltd (CMRL), a public listed company based in Kochi, Kerala, became the centre of a political storm after searches by the Income Tax Department in January 2019 revealed fake and inflated expenses to the tune of ₹130 crore. Incorporated in 1989 as a public limited company with the main objective of establishing a mineral processing unit for value addition of mineral sand, the company managing director Sasidharan S. Kartha was accused of paying bribes to various persons, including politicians and police officials, to ensure the smooth functioning of their business that depended heavily on public sector undertakings for sourcing its ilmenite raw material.

The Income Tax Interim Settlement Board (ITSIB) in August 2023 found that T. Veena, daughter of former Kerala Chief Minister Pinarayi Vijayan, and her now-defunct company Exalogic Solutions Private Ltd, had received monthly payments from CMRL despite there being no evidence of any services given in return. An investigation by the Serious Fraud Investigation Office (SFIO) under the Ministry of Corporate Affairs revealed fictitious cash expenses of about ₹182 crore over a span of 15 years, which was allegedly used by CMRL to bribe various persons. It found that CMRL had made payments amounting to ₹2.78 crore to Ms. Veena’s company without receiving any services in return. The Enforcement Directorate (ED) registered a case under the Prevention of Money Laundering Act (PMLA) on the basis of a prosecution complaint filed by the SFIO before a court in Ernakulam in April 2025. Ms. Veena appeared at the zonal office of the ED in Kochi on June 17, 2026 for questioning after skipping the initial summons issued by the agency citing health reasons.

The key findings of the Income Tax Department and the SFIO.

The Income Tax Department, which held searches at the CMRL under Section 132 of the Income Tax Act, 1961, on January 25, 2019 found that the company had inflated its expenditure by booking fictitious cash expenses under the heads of transportation and sludge handling, aggregating to about ₹133.82 crore during the financial years 2012-13 to 2018-19. The inflated expenditure reportedly enabled the generation of unaccounted cash that was allegedly used for making illegal payments to various persons and institutions. The company management and key officials had submitted that such payments were made to ensure the smooth functioning of the firm’s business operations. Some of the names of the recipients were reportedly mentioned in abbreviated form, triggering speculations whether it referred to its political beneficiaries. The SFIO found that Mr. Sasidharan Kartha, and his son Saran S. Kartha, joint managing director, had received ₹30.6 crore in cumulative remuneration from the financial year 2015-16 to 2022-23 despite no dividend payments. It was further alleged that CMRL paid ₹91 crore towards transport services to the companies owned by Mr. Sasidharan Kartha’s family. The SFIO stated that CMRL had made a monthly payment of ₹5 lakh to Ms. Veena and ₹3 lakh to her firm as retainer for IT and marketing consultancy services. The agency also found that Empower India Capital Investments Private Limited (EICPL), operated by Mr. Kartha, had extended loans worth ₹50 lakh to Exalogic despite the company allegedly failing to make timely repayments.

How did the controversy impact the previous Left Democratic Front (LDF) in Kerala and what were the attempts made by the then Congress-led United Democratic Front (UDF) Opposition to keep it alive in the public domain?

Mr. Vijayan came under repeated attacks from the Opposition, especially the Congress-led UDF, after it demanded his resignation as Chief Minister in April 2025 following the SFIO report indicting his daughter in the CMRL pay-off case. The former Kerala Chief Minister had rejected the allegations and had reiterated that her daughter’s firm had entered into a legitimate contract to provide consultancy service to a Kochi-based mining firm. The Left front upped its ante against the Opposition after the Supreme Court on October 6, 2025 refused to entertain a plea by Congress legislator Mathew Kuzhalnadan against Mr. Vijayan on the alleged financial transactions between his daughter’s now-defunct company and CMRL. The Congress had often alleged that a deal between the Communist Party of India (Marxist) and the Bharatiya Janata Party had delayed the probe into the sensational case.

What was the turning point in the ED’s probe in the case?

An order by the Kerala High Court on May 26, 2026 permitting the ED to go ahead with its probe in the monthly pay-off case brought the controversy back to the limelight. The court, which dismissed the CMRL’s plea to quash the case, directed the firm’s officials to appear before the ED and cooperate with the probe into the alleged irregularities pertaining to the financial transactions. The Central agency carried out searches at 12 locations across Kerala, including the residence of Mr. Vijayan, residences of P.A. Mohamed Riyas, who is Ms. Veena’s husband and former Tourism Minister, and the houses of the company’s promoters. Dramatic scenes unfolded in front of the residence of Mr. Vijayan in Thiruvananthapuram as workers of the Communist Party of India (Marxist) attacked ED officials and vehicles after the party leadership termed the raids “a targeted attack on an Opposition Leader by the BJP (Bharatiya Janata Party) government.” Several protesters were arrested and remanded as part of the probe initiated by the Kerala Police into the attack. The ED had frozen ₹18.36 crore in 242 accounts identified during the search operations held in the pay-off case. It had claimed that the searches held as part of the probe yielded several incriminating records, accounts, digital evidences, investments and fixed deposits in banks

On the possible political fallout of the controversy.

The CPI(M) has distanced itself from taking up Ms. Veena’s case, especially after Mr. Vijayan publicly stated that the ED officials did not question him during the search held at his residence. The violent incidents following the raids had also placed the party on the backfoot as it instantly drew parallels with the attacks on ED officials by Trinamool Congress workers in West Bengal’s Sandeshkali in January 2024. Senior party leaders have now come out in the open stating that Ms. Veena will handle the case legally on her own. However, the scenario may change if the ED steps up its action against Ms. Veena based on the findings that would emerge in the course of the ongoing probe.