NEW DELHI: A massive fraud in newsprint import involving a loss of at least Rs.3 crore worth of foreign exchange in a single deal has come to light.
The State Trading Corporation (STC) chairman S.C.Vaish is Understood to have endorsed the findings of an inquiry into the matter which revealed that the loss of foreign exchange would have been much more had the fraud not come out in the open and prompt corrective measures taken.
Commerce ministry sources said the inquiry also indicated that some unscrupulous top officials in the STC had been manipulating the import of newsprint to the detriment of the crucial balance of payment citation for quite some time.
In fact a woman executive of the STC who besides being a journalist member of the Newsprint Purchase Committee (NPC) was instrumental in exposing the fraud has since been transferred and harassed so much that she has gone on Jong leave.
The fraud came to light when at the NPC meeting on December 30 the women executive and the Journalist objected to the purchase 0f 5000 MTTs of glazed newsprint without inviting fresh bidders.
According to the details available from the commerce ministry the ministry of information and broadcasting allowed the STC to port 5000 MTs of glazed newsprint in addition to 30000 MTs approved earlier for 1991-92.
Despite objections at the NPC meeting on December 30 it was decided to place the order for the additional 5000 MTs with Ms FINNPAP the firm which fad supplied 9000 MITs on October 16-1991 at a rate of US $609 per MT.
The journalist and the woman executive apparently wanted fresh tenders to be invited because newsprint prices have been falling in the international market for some time. They were also of the view that since the government was planning to decentralize the import of newsprint it would be difficult to dispose of the remaining stocks at a competitive rate after the decentralization.
The ministry couriers said the inquiry by the STCs vigilance director Manzoor Ahmad later revealed that M/s FINNPAP had actually charged US $109 per MT more than the prevalent market fate at that time while supplying the earlier order of 9000 MTS 10 the STC.
In fact the sources said it was revealed that the same supply M/s FINNPAP through the same agent in India had supplied better quality glazed newsprint a private dealer of Chawri Bazar Delhi M/s Newsprint Trading and Sales Corporation at a rate of US $500 per MT at about the same time when the STC booked the order.
As a result the STC paid at least US $981000 more than the Prevalent market rate for the supply of 9000 MTs of glazed US print.
Article extracted from this publication >> February 21, 1992
