They were sold during Mayawati rule

The Akhilesh Yadav government on Tuesday decided to hand over the inquiry into alleged financial irregularities worth several hundred crores in the sale of 21 State-owned sugar mills to the Lokayukta. These mills were sold in a phased manner between July 2010 and March 2011 when the Bahujan Samaj Party government headed by Mayawati was in power.

The decision to hand over the probe was taken at a Cabinet meeting chaired by the Chief Minister.

A Government Order was issued on June 4, 2007, to disinvest the 10 operational sugar mills belonging to the UP State Sugar Corporation and the 11 closed mills belonging to its subsidiary, UP Rajya Chini Evam Ganna Vikas Nigam. The 10 operational sugar mills were based in Amroha, Bijnor, Bulandshahr, Chandpur, Jarwal Road, Khaddha, Rohanakalan, Sakhauti Tanda, Saharanpur and Siswa Bazar. The 11 closed mills were Baitalpur, Bhatni, Deoria, Shahganj,Bareilly, Laxmiganj, Chhitauni, Hardoi, Barabanki and Ghugli.

The report of the Comptroller and Auditor General (CAG) tabled in the Vidhan Sabha early this year had estimated that a loss of Rs.1179.84 crore had accrued to the State exchequer following the sale of these mills. The report alleged financial irregularities and under-valuation in the sale of land and machinery of the mills.

A Government spokesman said that the Lokayukta will inquire into the alleged irregularities and corruption in the sale of the 21 sugar mills. According to the CAG report, plant and machinery was valuated as scrap, stamp duty was not paid and there was no competitive bidding, the spokesman said. The bidders came to know about the estimated price before the bids were opened. The bidding method was changed whereby the core group on disinvestment placed emphasis on discounted cash flow instead of evaluating the land and buildings of the sugar mills, the spokesman added.

Political parties had alleged that the Mayawati government's decision to privatise the sugar mills was taken to benefit liquor baron Ponty Chadha who was alleged to be close to the Bahujan Samaj Party. In its election manifesto for the 2012 Assembly polls, it was stated by the Samajwadi Party that an inquiry would be conducted into the sale of the Government-owned sugar mills. When it appeared that the Samajwadi Party Government, which came to power in March 2012, was going slow on its promise, PWD & Irrigation Minister, Shivpal Singh Yadav set the record straight stating on the floor of the Assembly in June this year that an inquiry would be conducted into the sale of the 21 sugar mills.

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