The Enforcement Directorate has begun investigating an alleged ₹100 crore scam involving the supply of medicines and medical equipment to government hospitals and medical colleges in Uttar Pradesh, examining procurement records, supplier selection, and payments made over several years.
Why the ED Opened an Investigation
The ED has sought seven years of records from the UP Medical Supplies Corporation Limited (UPMSCL) as part of its probe. Officials allege the department has been delaying submission of this information, allegedly to allow evidence connected to the case to be destroyed. FIRs have already been registered in three districts of Uttar Pradesh, with former Congress MLA Mukesh Srivastava named as the main accused. While UPMSCL hasn't yet provided the specific records sought, the ED already has documents that formed the basis of the FIRs.
What Records the ED Has Requested
On July 3, the ED's Assistant Director for the Lucknow Zone wrote to Health Department Director General Dr Pawan Kumar Gupta, seeking information covering the 2019-20 to 2025-26 financial years, including details of companies invited through EOI or RFP processes for purchasing medicines and medical equipment, the volume of purchases from each supplier, and the payments made to those companies.
The agency also sought information on substandard medicines and equipment allegedly supplied to hospitals, what action was taken in such cases, and bank guarantees submitted against each tender and supply order. Investigators additionally requested details of government hospitals in Shravasti, Bahraich, Gonda, and Balrampur from 2013-14 onward, including their utilisation and medical reimbursement records.
Why Procurement Records Have Come Under Scrutiny
The Director General wrote to the UPMSCL managing director on July 16 seeking this information. Instead of providing the records directly, UPMSCL sought clarification from the Principal Secretary (Health) on whether purchase and payment-related documents could even be shared, a delay that has itself drawn scrutiny.
UPMSCL was originally established to curb corruption, following earlier complaints over how medicines and equipment were being purchased at the district level. It began operations in 2018 and has since handled most medical procurement in the state. The Centre channels funds to states for rural and urban healthcare through the National Health Mission, and UPMSCL uses these funds to float tenders, purchase medicines and equipment, and supply them onward to individual districts.
What Emerged After Mukesh Srivastava's Arrest
The investigation intensified after former MLA Mukesh Srivastava, also known as Gyanendra Pratap Srivastava, was arrested in a case linked to the same procurement documents the ED had sought. The agency began its own investigation following his arrest.
Around nine companies allegedly linked to his family and relatives were found to be involved in supplying medicines, equipment, furniture, and maintenance work in Bahraich, Balrampur, and Shravasti, allegedly receiving contracts worth more than ₹18 crore across these three districts.
What the UP Vigilance Probe Found
According to the allegations, the former MLA allegedly set up fake or unnamed firms and construction companies in the names of family members, relatives, and close associates, including the RG Group. These firms allegedly secured contracts worth crores without valid tenders, or on the basis of forged documents.
A separate Vigilance investigation into the Health Department in Balrampur, Shravasti, and Gonda found that substandard medicines and medical equipment were allegedly released for supply against work that had either not been completed or didn't exist at all on paper, backed by fake bills. Srivastava is also accused of conspiring with senior Health Department officials, including Chief Medical Superintendents and clerks, and investigators found allegations that his companies directly used the department's own GeM (Government e-Marketplace) portal ID.
How Tenders Were Allegedly Manipulated
The former MLA allegedly accumulated assets worth crores, including hotels, farmhouses, and plots, during and after his tenure as an MLA from 2012 to 2017, allegedly exceeding his known legitimate sources of income. The Vigilance probe also found allegations that, under a supervision scheme, funds intended for operating vehicles were illegally withdrawn for three vehicles, with the role of CMO Dr Ghanshyam Singh also emerging during the investigation.
Investigators further allege proper tender procedures weren't followed in several instances: printing work was carried out without any tender at all, while in other cases, deposits for tenders were issued and CMO approval exemptions obtained in ways that allegedly violated financial rules. Three CMOs, Dr Ghanshyam Singh, Dr Satyadev, and Dr Praveen Kumar, along with junior engineer Ram Manohar Maurya, have since retired. Vigilance has registered a case against them and continues its investigation.
The Scale of the Alleged Scam
The investigation concerns an alleged ₹100 crore scam in the supply of government medicines and medical equipment, a scale reflected in the sheer volume of records the ED has sought, spanning seven years of procurement activity. Investigators are examining how suppliers were selected, how much was actually purchased, how payments were processed, and whether substandard supplies or irregular procurement practices were genuinely involved throughout. Sources cited in the case note that the alleged pattern here resembles the ₹5,000 crore NRHM scam reported in 2011, one of the larger public-health procurement scandals in India's recent history.
Why This Case Highlights the Need for Stronger Oversight
These allegations underscore why transparent tendering, complete procurement records, and rigorous scrutiny of public health spending matter so much, particularly given how directly these purchases affect government hospitals and the patients who rely on them. A case of this scale is exactly why independent auditing services in india exist for public and private procurement systems alike, verifying that supplier selection, payments, and delivered goods genuinely match what's recorded on paper, before irregularities can compound over years the way they allegedly did here.
FAQs
Q1. How large is the alleged medical supply scam under investigation?
Approximately ₹100 crore, spanning medicine and equipment supply to government hospitals and medical colleges across Uttar Pradesh.
Q2. Who is the main accused in this case?
Former Congress MLA Mukesh Srivastava, also known as Gyanendra Pratap Srivastava, with FIRs already registered against him in three districts.
Q3. What did the Vigilance investigation allege?
That fake firms linked to Srivastava's family and associates secured contracts without valid tenders or through forged documents, with substandard medicines and equipment released against incomplete or non-existent work.
Q4. What records has the ED requested from UPMSCL?
Seven years of procurement data, including supplier details, purchase volumes, payments made, information on substandard supplies, and bank guarantees against tenders and supply orders.