Data on millers’ profits not given by States

‘Rs. 200 crore of black money is made every day through sale of by-products’

March 28, 2015 03:21 am | Updated November 16, 2021 05:12 pm IST - NEW DELHI:

The audit began following a complaint by an Odisha-based RTI activist.

The audit began following a complaint by an Odisha-based RTI activist.

Nine rice-producing States, some of which had been requesting revision of milling charges in favour of millers, did not provide the requisite data to the Department of Food & Public Distribution to facilitate feasibility study despite repeated reminders, according to an RTI reply.

The data sought also included audited accounts of the mills showing profits made from sale of paddy by-products.

“The hesitation to share complete information on money being made by millers by selling by-products (rice bran, husk and broken rice) is a clear indicator of how big the scam is,” said RTI activist Gouri Shankar Jain, whose complaint has been made part of the CAG audit into financial dealings of government institutions with rice mills in eight States.

Mr. Jain has alleged that Rs. 200 crore of black money is being generated every day through non/under-reporting of earnings from rice by-products by unscrupulous millers in collusion with tax assessing officials.

It was two back-to-back letters from Mr. Jain cautioning the Prime Minister’s Office, in December 2011 and January 2012, about wrong policy on custom milled paddy rice, that had prompted the PMO to alert the Department of Food and Public Distribution for action.

An RTI reply to Mr. Jain revealed that in January 2014, the Department wrote to Secretaries of Andhra Pradesh, Chhattisgarh, Haryana, Madhya Pradesh, Odisha, Punjab, Tamil Nadu, Uttar Pradesh and West Bengal highlighting the problems faced by the Tariff Commission in conducting a fresh study into requests for revision of milling charges.

Stating that the Commission was unable to make any recommendation for want of information or cooperation from State governments/millers, the department said there was no response despite repeated reminders. In the same letter, the Department mentioned Mr. Jain’s representation about “non-consideration of value of paddy by-products while fixing the milling charges and also huge profit-making by millers on this account.”

The department took up the issue with the Tariff Commission, which pointed out that only seven of the 15 States had furnished details, which were grossly inadequate for the study. Frustrated over poor response, the Commission gave up and had passed its recommendation in February 2012.

In the same letter, the department said while Mr. Jain complained of profiteering by millers, some States and millers would regularly seek increase in the milling charges stating it had not been revised since 2003.

The Department again asked the States to provide requisite data immediately, asking them to pursue the millers to furnish information required by the Commission for a fresh study. “In case selected millers are not willing to cooperate in the study, then State government concerned will be asked to take appropriate punitive action against them.”

“However, it did not make much difference and the unscrupulous millers continued to make huge profits, causing losses to the exchequer,” alleged Mr. Jain.

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