TN lost ₹2,000cr in PDS tenders in 5 yrs, says NGO in graft plaint

TN lost ₹2,000cr in PDS tenders in 5 yrs, says NGO in graft plaint

Siddharth.Prabhakar@timesgroup.com

Chennai:05.06.2021

Times of India :Chennai Edition 

Tamil Nadu lost at least ₹2,000 crore since 2015 in 50 tenders awarded for procuring sugar, palm oil and pulses for ration shops in the state, says a complaint filed by anti-graft NGO Arappor Iyakkam to the directorate of vigilance and anti-corruption (DVAC) on Friday.

Tender conditions were tweaked and designed to favour a cartel of companies and to eliminate competition, the NGO said. The prices finalised for supplying thousands of tonnes of essentials were way above even retail prices prevailing at that time, it said.

For instance, according to Arappor, for a tender (cancelled by the present DMK government) on May 5, 2021, for procurement of pulses, a company quoted around ₹145 per kg. But after Arappor flagged it, the tender norms were corrected and re-floated 10 days later. This time more companies participated and the same company quoted around ₹80 as price for pulses. Tamil Nadu saved ₹120 crore in this single tender alone.

Similarly, for sugar tenders, prior to 2019, sugar manufacturers participated directly in tender which kept the procurement price at ₹37 a kg. However, after tender conditions were modified in July 2019, the price went up to ₹47 a kg.

‘Govt paid a premium above wholesale rates’

Jayaram Venkatesan, convenor of the NGO, said, “When the same tender was re-floated a few months later, the same company, which had originally quoted ₹32.9, submitted a rate of ₹49.9 and all competing bidders had been rendered ineligible to bid.”

Arappor’s complaint pertains to tenders for supply of 2.7 lakh tonnes of sugar from January 2019 to 2021, 56.56 crore one-litre pouches of palm oil from 2017-2021 and 5 lakh tonnes of pulses (dhal) from 2015-2021.

According to the complaint, Tamil Nadu government paid a premium of ₹10 per kg for sugar, ₹15.95 per pouch for palm oil and ₹15 per kg for dhal over and above the wholesale rate.

To buttress their complaint, Arappor has also attached wholesale as well as retail rates of commodities obtained from the government-run Amudham stores. Though the government procurement was in bulk, the final rates were higher than even the retail rates in almost all cases.

Arappor’s evidence also shows that the cartel, led allegedly by Christy Freidgram group in Tiruchengode, also enrolled themselves as buyback suppliers for central government trading agencies like MSTC and Kendriya Bhandar. These agencies participated in TNCSC tenders and quoted the rates given to them by the cartel led by Christy Freidgram.

“This is violative of STC tender clauses which disallow buyback suppliers and STC participating in the same tender,” Arappor said in its complaint. Information obtained by Arappor through RTI shows that the STCs got only 1% of the earning, while the rest went to the buyback supplier. When contacted, a company official of Christy Freidgram said: “The allegations are completely false. We supply at prices lower than those quoted in the tender after negotiation with the government.”