The charges that did Natarajan in

Suspended BEML Chairman V. R. S. Natarajan. File photo

Suspended BEML Chairman V. R. S. Natarajan. File photo  

Though activists, whistleblowers and trade unionists have levelled a litany of charges against suspended BEML chief V.R.S. Natarajan, the CBI investigation is confined to two cases.

In Delhi, the CBI is investigating the method employed by the government-owned company to procure Tatra trucks for the Army. This has received the maximum attention from the media as well as members of Parliament and anti-corruption activists.

Procurement method

In Bangalore, the investigating agency is investigating the appointment in 2005 of the Coimbatore-based Astral Consulting Ltd. as a consultant to BEML for the implementation of the Enterprise Resource Planning (ERP) software, and the setting up of temporary local area network connections.

The allegation of fraud in the Tatra truck procurement has been the subject of controversy since 2005. But the issue gained traction after The Hindu published an interview with General (retired) V.K. Singh on March 26 this year. In it, the former Army Chief alleged that he was offered a bribe to clear the procurement of the “sub-standard” and “over-priced” trucks.

Beyond the alleged kickbacks and backroom dealings by lobbyists, the route taken by BEML to procure Tatra trucks is at the heart of the alleged scam. The allegation is that BEML violated purchase guidelines by placing orders with a middleman (Tatra Sipox UK), and not with the original equipment manufacturer, based in the Czech Republic.

Second, the CBI is also probing why ‘liquidated damages' were waived by BEML when the truck deliveries were delayed by Tatra Sipox. The contract stipulated the imposition of 0.5 per cent of the order value in penalty on the supplier for delayed deliveries.

Third, the CBI is also investigating why the purchase orders were amended to change the procurement currency from dollars to Euro. BEML allegedly suffered a loss of Rs. 18 crore on account of this change, which was executed after a meeting on February 6, 2007, in which Ravi Rishi was also present.

Mr. Rishi's Vectra Group is the largest shareholder in Tatra Holdings, which owns the truck manufacturer Tatra.

The Astral scam

Those alleging a scam in the appointment of Astral Consulting Ltd. have told the CBI that Mr. Natarajan may have put himself in conflict of interest by favouring a firm from his hometown. This apart, the CBI has said due diligence was not shown while companies with expertise in this area were short-listed.

Repeated delays

The investigators claim that this company was retained despite repeated delays in service deliveries, and penalty was never imposed on it.

Furthermore, BEML appointed Siemens Information Systems Ltd. as consultants for ERP solutions, based on the advice of Astral.

Other bids ignored

Though three other globally reputed firms took part in the tender, BEML allegedly did not even open their bids. Siemens charged Rs. 15 crore for the service, but whistleblowers allege that the same service is available elsewhere for Rs. 3-5 crore.

Why you should pay for quality journalism - Click to know more

Recommended for you
This article is closed for comments.
Please Email the Editor

Printable version | Apr 5, 2020 6:45:37 AM |

Next Story