The National Dairy Development Board (NDDB) was created to promote, finance and support producer-owned and controlled organisations. It was also expected to strengthen farmer cooperatives through various measures like providing funds and guidance to farmers to enhance their livelihoods.
However, it appears that, instead of taking care of farmers through the cooperative movement, NDDB has been busy ensuring the welfare of its retired senior executives. Apparently, NDDB used its subsidiary NDDB Dairy Services (NDS) to finance the employment of several retired senior executives with the same benefits that they were receiving before retiring from the board or its subsidiaries.
Insiders, who are disturbed at the misuse of funds tell us that Deepak Tikku, 71, who retired as managing director (MD) of NDDB (Anand), in 2010, was appointed chairman of NDDB Dairy Service immediately after retirement till March 2017. The salary and perks he used to receive as MD of NDDB, continued in this new position as well. After April 2017, Mr Tikku is working as advisor and mentor at NDDB Dairy Services and Mother Dairy Fruit and Vegetables Ltd (Mother Dairy).
Mr Tikku has been director of Mother Dairy since the company's inception in 2000. However, in 2015, following a notice for his removal by NDDB, he resigned. However, when Dilip Rath became chairman of NDDB, Mr Tikku was re-appointed as director of the company. Mr Tikku continues to hold that position even today.
Similarly, Dr Amrita Patel retired as chairman of NDDB in 2014. She was immediately made chairman of the management committee for semen station and breeding at NDDB Dairy Services. In 2010, Dr Patel was also made a permanent invitee to the board of NDDB Dairy Services; this takes care of her post-retirement trips to Delhi and other places which are paid by the company.
From August 2016, Mr Rath is the chairman of Mother Dairy. His term as chairman ended on 1 December 2018. On 3rd December, the government issued a notification (S.O. 5949(E)) extending Mr Rath's first term 'until further orders'.
Later on 6 March 2019, just before the model code of conduct came into force, the government decided to extend retrospectively Mr Rath's term for two more years.
The list of other executives enjoying such largess is in the table attached.
Incidentally, NDDB Dairy Services (NDS) was set up as a private limited company in 2009 with NDDB subscribing to only Rs1 crore as share capital.
Thereafter, NDDB’s nominee members moved a resolution to convert NDDB Dairy Services Pvt Ltd into a not-for-profit company under Section 25 of the Companies Act 1956 (now Section 8 of the Companies Act 2013). NDS was set up to function as the delivery unit of NDDB for field operations relating to promoting producer companies and productivity enhancement services.
NDDB Dairy Services was re-incorporated as a not-for-profit company in the very year that it was first incorporated as a private limited and wholly-owned subsidiary of NDDB. Immediately thereafter, the Board transferred Rs199 crore to NDDB Dairy Services, in the form of contribution of capital for purchase of equity of an equal amount.
The permission given by the Central government to NDDB was only for forming NDDB Dairy Services as a private limited company and the contribution of Rs1 crore as NDDB’s equity in NDDB Dairy Services when it was a private limited company could be considered in line with Section 43(2)(a).
The contribution of another Rs199 crore to NDDB Dairy Services as share capital from NDDB needed specific approval from the Central government as per Section 43(2)(b) of the NDDB Act.
Section 43(2)(b) of the NDDB Act requires that the Board (of NDDB) may contribute capital, transfer assets or render assistance in such manner and to such extent subject to specific previous approval of the Central government in this regard.
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