L Rajagopal, the chairman of Lanco group and Congress MP sprayed pepper spray while the Telangana bill was being placed in Lok Sabha. Lanco, which is in the debt restructuring process, has also been frequently involved in a number of controversies

Lagadapati or L Rajagopal is in the eye of storm for using pepper spray in the Lok Sabha for stopping the Telangana bill from being submitted. The Member of Parliament (MP) from the Vijaywada constituency is a known opponent of bifurcation of Andhra Pradesh. Although, this time, the Congress MP seems to have gone too far. Following the pepper spray incident, he, along with 17 other MPs, is suspended from the Lok Sabha for rest of the session. Earlier too Rajagopal has crossed swords with Lok Sabha Speaker Meira Kumar.

While speaking with Rajdeep Sardesai of CNN-IBN, the MP accused Congress leadership, including Sonia Gandhi, for influencing the Speaker to suspend him along with 17 other MPs. “More than 100 MPs were in the well on Thursday, the Speaker singled out some MPs, action must be taken against all MPs. Ministers were in the well too. The government and the Congress leadership influenced the Speaker to act in this manner. The procedure of introduction of the Bill was incorrect, she didn't read our names. We will be sending letters of how all procedures were violated to the Speaker and various political parties," Rajagopal told the channel.

Defending his stand over using pepper spray in the Lok Sabha, the expelled Congress MP said he used the spray only in self-defence as he was attacked by a mob. "I have a right to defend myself. Pepper spray is a legally allowed weapon of self-defence. What would I have done if the 'mob' attacked me. I used the pepper spray to disperse the crowd that had gathered at the well of the house," Rajagopal told CNN-IBN in an interview.

There is another side of Rajagopal, a corporate or business side that is also equally controversial. He is founder chairman of the Rs15,000 crore Lanco group that has interests in engineering, procurement and construction (EPC), power, solar, natural resources and infrastructure.

In 1985, Rajagopal joined Lanco, which at that time was a small company.

According to Wikipedia, Lanco grew at a tremendous pace since the early 1990s, after Rajagopal married the daughter of veteran Congress leader Parvathaneni Upendra, and joined politics himself. Initial growth was driven by large contracts primarily in construction. Later, other infrastructure areas such as power generation, transportation etc. were also added. 

"(Lanco's) key businesses have been frequently involved in a number of controversies. In 2007, (its) managing director GV Babu was caught at an airport with a suitcase containing Rs34 lakh in unaccounted cash. Repeatedly tarnished by charges of corrupt practices and contract irregularities, Lanco Infratech Ltd ran into financial trouble and has filed for Corporate Debt restructuring (CDR) in July 2013," Wikipedia says.

In December 2006, the company won a large contract citing a collaboration with Singapore firm Globeleq. However, two months later, Lanco (along with Jindal) acquired Globeleq Singapore, and other competing bidders alleged foul play, resulting in the bid being cancelled.

Wikipedia says, "In several situations, Lanco would obtain substantial reappraisals after winning a contract. In 2007, after winning the bid for the 1000MW Anpara-C power plant, Lanco requested that the power output be re-negotiated. Some competing firms protested since the re-negotiation process made the initial bidding meaningless. However, Lanco managed to retain the Anpara project."

In a similar bid for power plants in Uttar Pradesh, Lanco's bid was initially accepted, but after they asked for an increase in the power selling rate, fresh bids were sought and Reliance Energy went on to bag the contract.

"In 2007, it was revealed that the company had also been the beneficiary of a number of multi-crore insurance 're-appraisals', which are required by many contracts. The scam involved government owned insurance companies," Wikipedia says.

There were also charges of forgery against Lanco, when New India Assurance claimed that the policy number 610200/44/08/03/60000027 of Rs1.89 crore, submitted to the housing ministry, had not been issued by it.

By July 2013, the company had filed for corporate debt restructuring (CDR), citing a business slowdown. Nomura had kept its rating and valuation (target price) on Lanco 'suspended' as it says the company is in the process of restructuring the debt on its standalone balance sheet, by way of reference to the CDR Cell.

"Group net debt-to-equity, including working capital loans of power SPVs and Griffin Coal acquisition debt, stood at12.7x as of December 2013 compared with 10.7x as of September 2013. Receivables from state discoms stood at Rs2,770 crore as of December 2013 compared with Rs2,940 crore as on September 2013, as impasse on tariff-related issues continued; the decline in receivables was largely on the back of recovery of Rs160 crore from Uttar Pradesh," Nomura said. 

Coming back to Rajagopal, he has been most vocal opponent of Telangana. Last year, he even resigned from the Lok Sabha. However, Lok Sabha speaker Meira Kumar rejected the resignation of Rajagopal and 12 other MPs in October 2013. Rajagopal then approached the Delhi High Court seeking direction for the Lok Sabha speaker to accept his resignation.