Hyderabad co sold captive blocks, made Rs. 200 cr
A CBI probe has revealed that the promoters and shareholders of the Hyderabad-based Navabharat Power Private Limited (Navabharat) allegedly earned a profit of Rs. 200 crore illegally by selling two captive coal blocks allocated to it in Odisha.delhi Updated: Sep 15, 2012 09:32 IST
A CBI probe has revealed that the promoters and shareholders of the Hyderabad-based Navabharat Power Private Limited (Navabharat) allegedly earned a profit of Rs. 200 crore illegally by selling two captive coal blocks allocated to it in Odisha.
Navbharat — one of the five private firms the CBI has booked for misrepresenting facts to get blocks from the coal ministry— received the letter of allocation for Rampia and Dipside blocks on January 17, 2008.
According to the probe agency’s FIR, “the promoters and shareholders of Navabharat sold their entire shareholdings in July 2010 to Essar Power Limited and its subsidiary company at a profit of over Rs. 200 crore,” after the allocation.
The CBI has accused the company of allegedly misrepresenting and concealing facts to qualify and then make wrongful gains in connivance with unidentified public servants.
The firm was allocated the two blocks despite the fact that the power ministry — the ‘administrative ministry’ for allocations — had not recommended it for either of the blocks, the FIR said.
The power ministry’s recommendation is one of the key criteria considered by the coal ministry and its screening panel while allocating a captive coal block. The CBI has also accused the firm of allegedly “embellishing its claim for allocation of coal block” by inflating its net worth.
According to the FIR, Navabharat had claimed in its application that it had the financial support from Globleq Singapore Pvt Ltd (GSPL), Navabharat Ventures Ltd (NVL) and Mahalaxmi Group Ltd. It had claimed the combined net worth of NVL (Rs. 307.12 crore ) and GSPL (Rs. 1,778.14 crore) as its own.
But later, in the feedback form submitted to the screening committee, Navbharat allegedly cited the net worth of another company, Suez Energy International Pvt Ltd (R1.05 lakh), to bolster its claims, the FIR said.
Navbharat allegedly misrepresented its net worth to pass a benchmark set by the Central Electricity Authority, according to which an applicant firm's net worth should be a minimum of R0.5 crore per MW of the maximum capacity of the proposed power plant.