Rs 3.44 Crore SECL Compensation Scam: FIR Filed, Probe Widens in Korba

FIR Over Rs 3.44 Crore Scam Puts Spotlight on SECL and Revenue Officials

A compensation payout worth Rs 3.44 crore in Chhattisgarh’s Korba district has triggered a major criminal investigation into alleged fraud in land and property acquisition linked to South Eastern Coalfields Limited (SECL). Acting on preliminary findings, authorities have registered an FIR against two key accused, Khushal Jaiswal and Rajesh Jaiswal, along with several SECL officials who were part of committees responsible for examining and approving compensation claims.

Investigators believe the scam is only partially uncovered. While Rs 3.44 crore has been identified as irregularly disbursed so far, initial complaints suggest that the total value of suspected fraud could cross Rs 9 crore, indicating a wider pattern of manipulation and collusion across multiple files and claimants.

CBI–ACB Teams Conduct Ground Checks in Malgaon, Amgaon and Ralia

To move beyond paperwork and verify the ground reality, a joint team from the Central Bureau of Investigation (CBI) and the Anti-Corruption Bureau (ACB) recently visited villages including Malgaon, Amgaon and Ralia. Officials carried out spot inspections, interacted with local residents and examined structures for which compensation was claimed.

During these visits, investigators reportedly uncovered multiple discrepancies between the official records and the physical status of properties. In several instances, compensation had been released for houses that were either built on government land or on land belonging to third parties, raising serious doubts over the legitimacy of ownership and eligibility.

The on-ground checks are considered crucial because they help establish whether claims were backed by genuine titles, or whether documents were created and certified solely to siphon off public funds earmarked for acquisition and rehabilitation.

‘Fictitious Ownership’ and Repeated Claims: How the Money Was Allegedly Diverted

A preliminary audit by the ACB and CBI points to a systematic pattern of abuse. According to the probe, Khushal Jaiswal is alleged to have presented houses built on government land as his personal property, securing compensation of more than Rs 1.60 crore. This, investigators say, was not an isolated instance but part of a broader strategy to exploit loopholes in verification and documentation.

In villages such as Malgaon and Amgaon, the investigation has flagged a series of claims where houses constructed on government or third-party land were shown in the names of family members or close associates. These claims were reportedly cleared on seven separate occasions, together accounting for more than Rs 1.83 crore in compensation.

There are also cases where the same structure appears to have been recorded under multiple names, inflating the aggregate compensation that was released. Such repetition would not only distort land acquisition records but also indicate deliberate attempts to enrich a small group of individuals at the cost of the exchequer.

Role of SECL and Revenue Department Officials Under the Scanner

The FIR names officials who served on key committees tasked with determining eligible property owners, assessing compensation for structures and verifying the authenticity of claims. These committees play a gatekeeping role in any compensation exercise, making their due diligence central to preventing fraud.

Investigators have pointed out that such large-scale documentation fraud is unlikely to have occurred without some level of collusion. Valuation reports in certain files are said to be inconsistent, and in a few cases, inspection records are reportedly incomplete or missing altogether. This raises concerns that approvals may have been granted despite glaring gaps, or possibly in exchange for illegal gratification.

Based on complaints examined so far, the fraud footprint is believed to extend beyond the Rs 3.44 crore already verified. Authorities are treating this as a live and expanding case, with the potential for more officials and private intermediaries to be named as the probe deepens.

Digital Evidence, Land Records and Bank Trails Form Core of Investigation

The CBI–ACB teams are relying on a combination of documentary and digital evidence to build the case. Investigators are scrutinising land registry extracts, old and new construction photographs, circle rate valuations, compensation sanction orders and committee minutes alongside banking transactions linked to beneficiaries and intermediaries.

By mapping how compensation moved from government accounts to individuals, and comparing that flow with the underlying land records, the agencies aim to establish where claims were legitimate and where they were fabricated. Any mismatch between the scale of constructions on the ground and the amounts sanctioned on paper will strengthen the case for recovery proceedings and criminal prosecution.

Administration Orders Re-evaluation; Recoveries and Action Promised

In response to the emerging details, the local administration has asked SECL and relevant departments to re-examine all suspicious files. Files with unclear ownership details, missing inspection records or repeated claims for the same structure are being prioritised for review.

Officials have indicated that wherever payments are confirmed to be irregular, authorities will move towards recovering funds and initiating action against those found responsible. This may include departmental proceedings, suspension or dismissal of officials, and further criminal complaints, depending on each case.

For residents in the affected villages, the re-evaluation exercise is also an opportunity to regularise genuine claims and separate them from fraudulent ones. However, it is equally likely to create anxiety among those who fear being drawn into the investigation as witnesses, collaborators or accused.

Beyond One Scam: What the Case Signals for Public Finance and Governance

This alleged compensation scam is not just about numbers on a balance sheet. It underscores how gaps in governance, oversight and record-keeping can be exploited when large infrastructure or mining-related projects are underway. Compensation mechanisms are meant to protect households affected by land acquisition, but without strong verification, they can become vehicles for diversion of public money.

For public sector entities like SECL, the case is a reminder that transparent processes, layered approvals and regular audits are critical for maintaining credibility with both local communities and regulators. For citizens, it highlights the importance of insisting on documented, verifiable procedures whenever land or property is acquired in the name of development.

As the joint CBI–ACB investigation moves forward, more revelations and possibly additional FIRs are expected. How rigorously recovery is pursued, and how quickly accountability is fixed, will be closely watched as a test of the system’s ability to respond to economic fraud within government-linked projects.

At Shunyatax Global, we track such cases closely because they sit at the intersection of public finance, governance and compliance. Compensation scams distort not only government budgets but also tax planning, corporate risk and long-term project viability. Robust internal controls, third-party audits and transparent documentation are essential shields against similar risks for businesses and institutions.

If your organisation deals with land acquisition, compensation frameworks, large-scale payouts or public-facing schemes, our experts can help you design stronger compliance, audit and monitoring protocols to reduce exposure to fraud and regulatory scrutiny.

Explore more insights and advisory services at Shunyatax Global: visit Shunyatax Global Services to connect with our team, access in-depth analysis and stay updated on critical developments in economic fraud, regulation and governance.