CBI files case against Adani Enterprises, NCCF officials in APGenco Coal Supply Issue
In trouble brewing for the Gautam Adani-led M/S Adani Enterprises, the Central Bureau of Investigation on Thursday said it has registered a case against former officials of the National Co-operative Consumer Federation (NCCF) and others over alleged irregularities in supply of coal to the Andhra Pradesh Power Generation Corporation (APGENCO) in 2010.
 
The CBI in its FIR has named Virendra Singh, the then Chairman of the NCCF, G.P. Gupta, the then MD of the NCCF, S.C. Singhal, the then Senior Advisor of NCCF, Adani Enterprises Ltd and other unknown public servants and others for criminal conspiracy, cheating and criminal misconduct by public servants. 
 
According to CBI, the case was filed on Wednesday after the preliminary enquiry revealed the crime by the officials named in the FIR and the Adani Enterprises was found to be true. 
 
The FIR alleged that on June 26, 2010, APGENCO floated a tender enquiry for supply of six lakh metric tonnes of imported coal "on free on rail destination" basis to Dr Narla Tata Rao Thermal Station (NTTPS), Vijaywada and Rayalasaleema Thermal Power Plant (RTTP), Kadapa, Andhra Pradesh/RTPP via Kakinada-Vizag-Chennai-Krishnapatnam or any other ports. 
 
The same was forwarded by the Chief Engineer, APGENCO to seven PSUs -- PEC Limited, STC Limited, MSTC Limited, NCCF, MMTC, Coal India Limited and SCCL Limited. 
 
The FIR alleged that during the probe, the Adani Enterprises used a proxy company to get the supply contract. It said, "NCCF received bids from six companies -- Adani Enterprises Ltd, Maheshwari Brothers Coal Limited (MBCL), Vyom Trade Links Pvt. Ltd, Swarana Projects Pvt. Ltd, Gupta Coal India Ltd and Kyori Oremen Ltd. 
 
During investigation it was found that Gupta Coal India Ltd had quoted the NCCF margin of 11.3 per cent, while the MBCL quoted the margin of 2.25 per cent and rest did not quote any margin to the NCCF. 
 
The FIR said the quotes of the Gupta Coal India Ltd, Kyori Oremen Ltd and Swarana Projects Pvt. Ltd were rejected by the NCCF as they were not found to be fulfilling the tender conditions. 
 
"Post tender negotiation was done by senior officials of NCCF to give undue favour to Adani Enterprises Ltd despite it not qualifing the tender (terms)," the FIR said, adding instead of cancelling the bid of Adani Enterprise Ltd, senior management of NCCF conveyed the offer margin to the company through one of its representative -- Munish Sehgal, who was sitting in the NCCF head office.
 
"It is prima facie evident that when the bids were being processed at NCCF head office in Delhi, a representative of Adani Enterprises Ltd. was informed regarding their imminent rejection due to non-submission of NCCF margin and also that MBCL was eligible bidder quoted 2.25 per cent margin," it alleged. 
 
The CBI in FIR further alleged that Adani Enterprises Ltd. had given an unsecured loan of Rs 16.81 crore to Vyom Trade Links Ltd in 2008-09. "And further it was revealed that the bank guarantees of the Adani Enterprises Ltd. and Vyom Trade Links Ltd. were issues by the same branch of the State Bank of India and at the same time," it said.
 
"It was clear that Adani Enterprises Ltd. presented Vyom Trade Links Ltd. as a proxy company in this particular tender and Vyom Trade Links Ltd. later withdrew its offer on flimsy ground," the CBI FIR said.
 
"The aforesaid acts of commissions and omissions on the part of the senior management of the NCCF disclose that during their tenure, they acted in a manner unbecoming of public servants and committed irregularities by way of manipulation in the selection of bidders, thereby giving undue favours to Adani Enterprises Ltd. in award of work for supply of coal to APGENCO despite its disqualification," it added.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    Ramesh Poapt

    2 weeks ago

    both are controlled by high power!

    ED summons AirAsia top brass for questioning on Jan 20
    The Enforcement Directorate (ED) on Thursday said it has summoned AirAsia's top management including its Malayasia-based CEO Tony Fernandes for questioning on January 20.
     
    A source in ED said that they have summoned the top brass for questioning under the sections of Prevention of Money Laundering Act.
     
    The ED had registered the case of money laundering against AirAsia officials and others for allegedly trying to manipulate government policies through corrupt means to get international licenses for its Indian venture AirAsia India Limited in mid 2018.
     
    The central financial probe agency filed the case to probe if alleged tainted funds were used to create illegal assets and it has taken cognisance of the CBI's FIR to lodge its own case.
     
    The CBI had named Fernandes and others in the case of violating FDI norms in giving effective management to a foreign entity through FIPB clearance in 2013.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Competition Commission Orders Probe against Asian Paints’ Alleged Market Dominating Tactics
    The Competition Commission of India (CCI) has asked its director general to initiate an investigation against Asian Paints Ltd under the provisions of section 26(1) of the Competition Act, 2002, based on information received from JSW Paints Pvt Ltd.
     
    In its 14 January 2020 order, the CCI bench of Ashok Kumar Gupta (chairman), Sangeeta Verma and Bhagwant Singh Bishnoi, both members, noted that "...the alleged restrictions on dealers not to deal with JSW Paints or any other company manufacturing paints can create barriers for suppliers of paints, who compete with these suppliers besides not allowing the benefit of better prices to the consumers. A stipulation that appears to create barriers to entry and restricts choice of consumers is likely to result in appreciable adverse effect on competition resulting in higher prices for consumers."
     
    "Based on material available on record, the Commission is of the view that evidence provided by JSW Paints is prima-facie sufficient to indicate that Asian Paints has denied access to the distribution channels in the relevant market to JSW Paints by threatening and coercing such dealers through various means. In view of foregoing, Asian Paints, prima-facie, appears to be in contravention of provisions of Section 4(2)(c) of the Act," the order says.
     
    The Commission then directed its DG to investigate the matter and submit reports within 60 days. 
     
    In its complaint, JSW Paints has alleged that immediately after the launch of its decorative paints, Asian Paints began pressurising dealers who had agreed to stock and display decorative paints manufactured by the Jindal group company. 
     
    "Asian Paints targeted dealers, distributors and retailers partnering with JSW Paints directing them to stop dealing with JSW Paints, stopping supplies to these dealers, dropping service levels by delaying supplies and deliveries, asked dealers to remove display of JSW Paints products from their retail shelves and dealer signboards, threatened dealers by not allowing discretionary discounts, not inviting them for trips and loyalty schemes. Asian Paints did this through its sale personnel in the relevant regions. Such conduct has been alleged to have created fear amongst retailers and dealers, as a result of which a number of them stopped dealing with JSW Paints, despite having provided the initial cheque of Rs1 lakh," JSW Paints had said.
     
    The complaint filed by JSW Paints also cites allegedly similar tactics used by Asian Paints against Nippon Paint India Pvt Ltd. It says, "Asian Paints had taken punitive action against a dealer in the past on account of its decision to stock and sell paints manufactured by Nippon Paint. Asian paints is stated to have resumed its supplies only after the dealer agreed to cease business relations with Nippon. In the year 2015-16, Nippon had attempted to enter the decorative paints market in Chennai. However, Asian Paints took similar action against the dealers who entered into commercial relationship with Nippon."
     
    As per the information, decorative paints constitute 74% of the market sales. Industrial paints comprise general industrial, automotive, protective powder coatings, and coil coatings constitute 26% of the market sales.  
     
    In its order, the CCI observed sales of decorative paints require extensive dealer networks, especially in the rural and semi-urban markets; hence, a strong supply chain and pan-India distribution is essential for making products successful. Brand also plays an important role in the decorative paints segment. Within the decorative paints segment, consumers prefer branded products in the organised sector rather than unbranded products of the unorganised sector, it noted.
     
    The Commission noted that Asian Paints is the largest player in the relevant market. As per the information, Asian Paints has the highest market share based on all parameters including revenues, earnings before interest, taxes, depreciation, and amortisation (EBITDA) and installed capacity. Based on revenue, it has a market share of 55.92%, with the second player, Berger Paints being at 18.79 % for the FY17-18.
     
    It has also been stated that Asian Paints has 60,000 dealers and 135 depots across the length and breadth of the country. The next competitor is Berger Paints at second place with 25,000 dealers and 129 depots.
     
    There are four top operators in this industry, namely, Asian Paints, Berger Paints, Kansai Nerolac, Akzo Nobel, who have occupied around 80% of the relevant market, with Asian Paints maintaining its highest market share consistently over the years. Based on this, the Commission noted that Asian Paints prima-facie appears to enjoy a dominant position in the relevant market delineated above.
     
    In a regulatory filing, Asian Paints says "The company is currently examining the order and will take appropriate legal recourse and will extend full co-operation to CCI in the matter."
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    COMMENTS

    Ibrahim Sakarwala

    2 weeks ago

    Asian paints controls a huge chunk of the paints market. Why does it need to even bother about a company which is practically unknown. Many do this to get free publicity and thereby utilize such stunts as marketing gimmicks. Having said this.... Even if we consider something like this must've happened..... It will be impossible to prove it in a court of law

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