CITCO officials throw sale policy to wind
Shoddy and flawed functioning of Chandigarh Industrial and Tourism Development Corporation (CITCO) officials is said to have cost the corporation around Rs 1 crore.chandigarh Updated: Apr 17, 2013 11:38 IST
Shoddy and flawed functioning of Chandigarh Industrial and Tourism Development Corporation (CITCO) officials is said to have cost the corporation around Rs 1 crore.
According to sources, the officials of the CITCO sale depot threw norms to wind while buying hot rolled (HR) coils worth around Rs 1.13 crore on an order placed by a city-based industrialist.
At present, more than 204 tonne HR coil is gathering dust at the sale depot, which was procured by CITCO on the order placed by the industrialist in three lots in the months of November and December last year.
Though the rules make it mandatory that the customer has to submit 10% of the cost of material to be purchased as advance, in this case the initial procurement of 62 tonne was done without taking any advance payment.
The company lifted around 48 tonne material while the remaining consignment is still lying at the depot even after the lapse of more than three months.
According to the sale policy, consumers are permitted to hold procured material for a period of 45 days. However, extension for another maximum period of up to 30 days can be granted if formally applied for by the unit along with 25% value of the material held at the CITCO sale depot. In case the unit lifts the material partially, then the total advance with CITCO should be not less than 35% of the value of the material lying with it. In such case, after 60 days, 2% per annum additional interest shall be charged on the invoice value of the balance material lying with CITCO.
Contrary to the policy, in this case, the official concerned granted the extension without taking permission from the competent authority and 25% advance from the customer was also not taken.
The department presented a cheque of Rs 20.77 lakh, issued by the customer, in the bank, which bounced. The department did not forward the matter to the legal cell of CITCO for initiating proceedings under section 138b of the Negotiable Instruments Act.
Despite repeated attempts, managing director CITCO DK Tiwari was not available for comment. Chief general manager (CGM) Tilak Raj refused to comment on the issue.
General manager (sales) AK Malhotra accepted that there had been deviation in implementation of the sale policy, which had led to blockage of funds. However, he claimed that they might not face any loss as they intend to sell the material, which was in saleable condition.
Erring official transferred
After the lapse came to the light, the management reportedly transferred the erring manager out of the sale depot and posted him at the headquarters. According to sources, the management is contemplating taking stringent action against the official after conducting an inquiry.
Role of auditors under scanner
The role of the internal auditors has come under the scanner as they failed to point out serious lapse in their monthly report of December and subsequent months.
First Published: Apr 17, 2013 11:37 IST