From goat trader to millionaire - How Nagarajan Seyyadurai's SPK group shot to the top in Tamil Nadu
The recent Income Tax raids on the SPK Group have rung alarm bells in the power corridors of Tamil Nadu. Nagarajan Seyyadurai, the managing director, is said to have close links with leaders in the ruling AIADMK.
A prominent civil construction firm, the SPK group has won contracts worth over Rs 2,000 crore in the past few years.
I-T sleuths have recovered over Rs 170 crore of unaccounted cash and gold bullion of over 100kg during searches conducted at 10 premises of SPK Group across the state.
Gold biscuits weighing around 100 kg and Rs 163 crore in cash that is suspected to be unaccounted, seized by the Income Tax department from 20 locations of SPK company in Madurai, Aruppukkottai, Vellore and Chennai. Raids started y'day, still underway at few locations. #TamilNadu pic.twitter.com/LY5fgyS9TM
— ANI (@ANI) July 17, 2018
Gold seized from SPK Group, Chennai along with Rs 100 cr in cash. And i thought demonetisation was to the death of kala dhan @IncomeTaxIndia pic.twitter.com/Tmq3IxDvGG
— meetu jain (@meetujain) July 16, 2018
Rags to riches
The rise of Nagarajan Seyyadurai is a classic rags to riches story. From humble origins, Nagarajan climbed up the corridors of power at a meteoric pace.
The story begins with Seyyadurai, a small-time goat trader from Aruppukottai, a town nearly 50km from Madurai, who started off by selling goats to butchers. He came in touch with Suganya Ramakrishnan and Sundararaj Reddiar, small-time contractors in Aruppukotai. Along with them, Seyyadurai started taking up small-scale work in the state highways department.
The trio also started a spinning mill in Kallakurichi. However, owing to internal differences, Reddiar and later Ramakrishnan exited the business. Seyyadurai soon started to single-handedly take up contracts for road projects.
Sources say Seyyadurai gradually developed connections with leaders in the DMK and AIADMK. He, however, developed closer ties with the AIADMK after the party came to power in 2011, and thus began his rapid rise.
In an effort to expand his business operation, Seyyadurai's son Nagarajan, an engineering graduate joined the family business. Soon, Nagarajan moved to Chennai to strengthen their business operations.
In Chennai, he befriended a senior minister's son, who had interests in state road and highway projects. This led to a spurt in business. The SPK Group bagged many of the lucrative tenders in the highways department in the past few years. Sources in the state secretariat say Nagarajan was a regular visitor to the secretariat and wielded influence in political circles.
Nagarajan Seyyadurai is director of three companies: SPK Spinners private Limited, Sri Balaji Tollways (Madurai ) Private Limited and SPK and Co Exppressway Private Limited.
Interestingly, the director of SPK and Co Expressway Private Limited is Subramanian Palanisamy, father-in-law of Mithun, who is the son of Tamil Nadu CM Edappadi Palanisamy.
Subramanian Palanisamy and Nagarajan have other business connections as well. They both jointly run the Sri Balaji Tollways Madurai (Private) Limited, another prominent company that has bagged contracts from the state highways department.
The company was incorporated in February 2016 with Subramaniam Palanisamy as the director. Nagarajan joined as its director in September 2017. The company bagged the contract of four-laning of the Madurai ring road in 2017. An additional grant was issued in March this year for completion of the project.
The 'nexus'
The I-T raids on the premises of the SPK Group across the state are politically significant for two reasons.
Firstly, the department of highways is a portfolio directly under chief minister chief minister Edappadi Palanisamy. The raids have highlighted direct links between the chief minister’s relatives and the firms that have been raided. It has also exposed discrepancies in tendering process in the highways department. The CM has been holding the additional portfolio since 2011.
The I-T raids on SPK Group came close a week after searches on the premises of Christy Friedgram Industry, a major supplier of food to over 563 Anganwadi centres in Tamil Nadu. Political analysts believe the successive I-T raids are an indirect attack on EPS.
Secondly, the opposition DMK had earlier alleged that EPS was favouring the SPK Group in awarding contracts, and filed a complaint with the directorate of vigilance and anti-corruption.
The party even submitted a memorandum to governor Banwarilal Purohit, seeking a probe into the "criminal misconduct" by the chief minister in the wake of IT raids.
DMK submits memorandum to governor over I-T raids at SPK group, seeks action against EPS. @Lokpria joins in for more. #ITVideoMore videos: https://t.co/Nounxo6IKQ pic.twitter.com/SZX2d717GB
— India Today (@IndiaToday) July 23, 2018
Unfazed by the developments, chief minister Edappadi Palanisamy has blamed opposition parties for making unsubstantiated allegations and asserted that the I-T raids have nothing to do with his government.
He further added that he has friends/relatives all over the state who bid for contracts from the government and termed the opposition allegations as politically motivated.