New Delhi: The CBI may ask the Enforcement Directorate to look into the role of two Mauritian firms, allegedly used for routing illegal money as investment in a power project by Kadapa MP Jaganmohan Reddy, the son of former Andhra Pradesh CM Y S Rajasekhara Reddy.

The agency is understood to be scrutinising the transactions made by Jagan with the two Mauritian firms as it is alleged that these companies were used to route funds into the country to increase the MP's stake in a Bangalore-based power company, sources said.

The agency might write to ED to look into the allegations of money laundering and forex violations in the transaction of these firms with the power company, sources said.

The power project itself is under the scrutiny of CBI as the complainant has alleged that Jagan raised Rs 797 crore for the project, which is worth Rs 150 crore, after taking over from its promoters during his father's tenure as Chief Minister in 2001, they said.

As alleged in the complaint received by the CBI, he allegedly set up a hydel power plant with the investment of about Rs 145 crore which included about 90 crore as loans and rest as equity.

The agency has set its eyes on the alleged investments of Rs 124 crore made by the Mauritian firms in the power project through a share purchase mechanism.

These shares were later alleged to have been purchased by Jagan from these companies at a throwaway price and the money received by the power company was used to repay bank loans and raise four subsidiary companies.

CBI is probing whether this transaction has a link to the alleged bribe received by Jagan on behalf of his father.

Meanwhile, the CBI is also looking at the role of a close confidante of a former Chief Minister who was appointed as director in the power company on behalf of one of the Mauritian firms in question.

It is alleged after the share transfer, he resigned from the post but the company did not appoint a new director in his place which has raised the suspicion of the investigators that the deal was nothing but meant to route illegal money.

CBI has recently carried out searches in five cities and collected vast number of documents which are under the scrutiny of the agency.

(Agencies)