BJP alleges Rs 5,000 cr. scam in DVB privatisation

NEW DELHI MAY 29. The Leader of Opposition in Delhi Assembly, Jagdish Mukhi, today alleged a major scam exceeding Rs 5,000 crores in the privatisation of Delhi Vidyut Board and demanded that the Delhi Government immediately cancel the process and invite fresh bids.

Addressing a press conference, Prof. Mukhi said "there was a deep-rooted conspiracy between the Ministers, top bureaucrats and the bidders for the distribution companies'' and therefore called for an audit of DVB by the Comptroller and Auditor General of India and its valuation by a Government-approved valuer as is required by the disinvestment policy.

Prof Mukhi also accused the Government of making offers of exceptional favours to all the three companies -- Tata Power, BSES Limited/Reliance Industries Limited, and Noida Power Company Limited -- which were bidding for the three zones. Still, in spite of the most favourable terms, these companies made conditional bids on their own terms, he said.

And rather than rejecting the conditional offers as per the Contract Act of India and going by the statement made by the Chief Minister, Sheila Dikshit, on the floor of the House that the offers of the bidders have been rejected and the Government will not have any dialogue with them, the Opposition leader said the Delhi Government "illegally'' constituted a Core Committee to have further discussions with the bidders.

Enumerating the various discrepancies in the manner of bidding, Prof. Mukhi said there has been concealment of material truth in the relevant documents that has a direct bearing on the entire procedure. Also, he claimed that the three distribution companies probably had prior knowledge for guaranteed returns on their investments.

The former Delhi Finance Minister also said that the past performance of these companies in other states of India was not taken into consideration and alleged that they have caused loss of thousands of crores of rupees to the Exchequer in Kolkata, Orissa and Uttar Pradesh.

Further, he said, favours were shown to these companies in the Transfer Scheme Rules and the Policy Direction issued by the Government of Delhi in violation of Section 28 of Delhi Electricity Reforms Act 2000 and Schedule VI and Section 57 and 57A of Electric Supply Act 1948.

The biggest concession, he said, was in the Business Valuation Method Adopted for Valuation of Assets which valued DVB at Rs 2360 crores. The method, he said, should not have been adopted as Delhi Government had allowed 16 per cent assured returns to the bidders on their investments. Also, instead of CAG, the valuation was done by SBI Capital in violation of the policy document.

Further, the three-year-moratorium on payment of interest on the loan of Rs 1416 crores taken by the distribution companies, he said, meant that the Government was gifting them Rs 510 crores. And by giving 2500 residential quarters and office complexes worth Rs 700 crores to these companies at just Rs 1 per month, Prof. Mukhi said the Delhi Government was extending them a concession of another Rs 700 crores.

Also, he said, the Government would be making available Rs 3,500 crores as loan to the transmission company for meeting the losses of the private companies whereas it actually amounted to a concession of the like amount.

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