Centre suspends Hindustan Newsprint Limited MD

Four years after he took charge as the Managing Director of Hindustan Newsprint Limited (HNL), Velloor , near here, the Ministry of Heavy Industries and Public Enterprises has suspended R. Gopala Rao from the post, pending inquiry.

In an order dated December 31, 2020 and signed by Rao Vineet Kumar, Under Secretary to the Government of India, Mr. Rao has been placed under suspension with immediate effect till further orders. The order noted that the continuance of the official in the present position was likely to interfere with the process of a fair and transparent investigation.

The order further directed Mr. Rao not to enter any of the company offices during the suspension period, unless called upon by a competent authority in writing. “He is directed not to leave the headquarters of the company — HNL, Velloor, Kottayam district, Kerala — without prior permission of the competent authority,” it stated.

HNL sources said the order followed an ongoing Central Vigilance Commission inquiry against the official based on a flurry of corruption charges raised by company employees, trade unions and supply contractors. Mr. Rao had taken charge as MD of HNL in November 2016.Liability touches ₹500 cr.

“The company, as on December 2016, had raw materials worth ₹30 crore at its disposal, which was sufficient to maintain production for three months, besides newsprint stock worth ₹25 crore and ₹25 crore as receivables — totalling to a working capital of ₹80 crore. The company, however, failed to cash in on the favourable factors, including the price hike in newsprint and the re-imposition of import duty, resulting in its total liabilities going up from ₹120 crore to nearly ₹500 crore,” alleged a top official of the company.

With its production plant remaining shut since July 2018, the company’s financial creditors approached the National Company Law tribunal and it now is undergoing Corporate Insolvency Resolution Process. Recently, the State government announced its plan to take over the company using the Kerala Infrastructure Investment Fund Board (KIIFB) fund as part of its 100-days Action Plan.

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Printable version | Apr 23, 2021 7:18:43 PM |

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