At last Gautam Adani has been caught in the coal import scam. The Central Bureau of Investigation (CBI) has registered a case of cheating and corruption against Adani Enterprises and a former Chairman and an ex-Managing Director of multi-state cooperative National Co-operative Consumers Federation (NCCF) for irregularities in selecting a company for a tender to supply coal to power stations in Andhra Pradesh. The CBI accused Gautam Adani-led Adani Enterprises of totally violating tender norms, even without quoting the price and bagging the order by removing other participants illegally. In the tender Adani Group even put a benami firm!

For the past four years, PGurus has been publishing a series of reports on the Coal Import scam where Adani is the major beneficiary. Apart from Adani, Anil Ambani’s Reliance, Essar and Jindal groups were also part of the Rs.30,000 crores Coal Import scam by inflating the bills. This gigantic scam happened during the 2009-2011 period of the United Progressive Alliance (UPA) which lead to the escalation of electricity bills of the common man. The Department of Revenue Intelligence (DRI) unearthed this scam as to which companies inflated the bills in coal import and machinery import. Even Many banks including the State Bank of India (SBI) did not cooperate with the investigating agencies. SBI’s Then Chairperson Arundhati Bhattacharya was hell-bent on protecting the corrupt companies[1].

The details of CBI FIR against Adani Enterprises:

The CBI FIR said that the Andhra Pradesh Power Generation Corporation (APGENCO) had floated a limited tender enquiry for the supply of six lakh Million Tons (MT)s of imported coal via seaports to Narla Tata Rao Thermal Power Plant in Vijaywada and Rayalaseema Thermal Power Plant (RTPP) in Kadapa on June 29, 2010. The tender enquiry was forwarded to seven PSUs including National Co-cooperative Consumer Federation India Ltd (NCCF), a multi-state cooperative under Union Consumer Affairs ministry with 78 percent government stake. That time the Union Agriculture and Consumer Affairs Minister was none other Sharad Pawar.

The CBI booked Adani Enterprises, the then NCCF chairman Virender Singh, the then managing director of NCCF G P Gupta and its senior advisor S C Singhal under IPC sections related to alleged criminal conspiracy and cheating and Provisions of Prevention of Corruption Act for allegedly favouring the Ahmedabad-based company in the tender and violation of guidelines.

Gautam Adani and his brother Rajesh Adani are the key Directors in the accused firm Adani Enterprises Limited. The FIR said that the officers “committed irregularities by the way of manipulation in the selection of the bidders, thereby giving undue favour to Adani Enterprises in the award of work for supply of imported coal to APGENCO despite its disqualification.”

Giving details of alleged criminal conspiracy and corruption, the CBI alleged that NCCF, Hyderabad unit which had received the APGENCO tender inquiry on June 29 had forwarded it to its headquarters in Delhi to Singhal, the officials said. The same day the head office selected a single party – Maharishi Brothers Coal Limited (MBCL) – to transport the coal at a margin of 2.25 percent instead of initiating the process for floating an open tender to call for bids from the competitive bidders citing lack of time as the deadline was July 7, they said.

Six days later, on July 7, APGENCO informed NCCF, Hyderabad that the date of the tender has been extended to July 12 following which allocation to MBCL was canceled and open tender was floated, they said. “It is pertinent to mention here that before extension of the date of tender they had seven days (July 01, 2010, to July 07, 2010) and after extension of date they had five days only (July 08 to July 12, 2010) but now management felt that they have sufficient time to call an open tender,” the CBI FIR has alleged.

The draft tender notice was discussed and approved by three senior officials of NCCF – Singhal, Gupta, and Singh – who ignored the laid down guidelines without consulting Head Office level committee, it alleged. Six bidders Adani Enterprises, MBCL, Vyom Trade Links, Swarana Projects Gupta Coal India, and Kyori Oremin responded to NCCF Tender on July 10, 2010, whose details and bids were tabulated and sent to the headquarters by Hyderabad unit on the same day, it said.

Gupta Coal had quoted 11.3 percent NCCF margin while MBCL had kept it at 2.25 per cent but remaining companies had not quoted any NCCF margin, it said. Bids of Gupta Coal, Kyori Oremin and Swarana Projects were rejected by NCCF as they did not fulfill tender conditions, the FIR claimed.

The CBI has alleged that senior officers of NCCF did post-tender negotiations with Adani Enterprises to give it undue benefits even though the company did not qualify when the tender was opened at Hyderabad office of NCCF, the officials said.

“Instead of canceling the bid of Adani Enterprises Ltd. Senior management of NCCF conveyed the offer margin of NCCF to the company through one of its representatives Munish Sehgal who was sitting in the NCCF head office on July 10, 2010, in the evening…,” the FIR alleged.

It said subsequently Adani Enterprises Ltd on the same day informed NCCF that they agree to pay minimum margin charge of 2.25 percent to NCCF. “It is prima facie evident that when the bids were being processed at NCCF HO. New Delhi. The representative of Adani Enterprises was Informed regarding their imminent rejection due to non-submission of NCCF margin and also that MBCL, the eligible bidder had quoted 2 25 percent margin,” the FIR alleged.

The agency has also alleged that Vyom Trade Links was a proxy of Adani Enterprises which had given it an unsecured loan of Rs.16.81 crores and withdrew its offer at the last stage on “flimsy grounds”.

[with PTI inputs]

References:

[1] Is Arundhati Bhattacharya protecting Coal importers who indulged in over-invoicing? Jul 23, 2016, PGurus.com