Coalgate: CBI quizzes Nava Bharat Power directors

The CBI today questioned two directors of Hyderabad-based Nava Bharat Power Private Limited in connection with alleged misrepresentation of facts by it while applying for a coal block.

The CBI on Wednesday questioned two directors of Hyderabad-based Nava Bharat Power Pvt Ltd (NPPL) in connection with alleged misrepresentation of facts by it while applying for a coal block.

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CBI sources said promoters and directors of the company, Y Harish Chandra Prasad and P Trivikrama Prasad, were called to the agency headquarters here for questioning.

They said the duo would be asked about the claims made by them about the net worth of the company while applying for coal block in 2006. The company was allocated Rampia and Dipside of Rampia coal block in 2008.

CBI had booked the company and the directors for alleged cheating and provisions of the Prevention of Corruption Act.

The agency has alleged in the FIR that the company, in order to claim a coal block inflated its net worth, an important criteria for determining eligibility of a firm, to nearly Rs 2,000 crore by claiming they were supported by companies without having any legal basis for such a claim, the sources said.

CBI alleged that the coal ministry had kept a minimum net worth of Rs 50 lakh per mega watt of the maximum capacity of the proposed power plant as a pre-qualification criteria for applicant companies, they said.

The FIR alleged that the company with a proposed capacity of 2,240 mega watt would not have pre-qualified for the recommendation of the ministry of power but for this deception.

The CBI also alleged that promoters of the company sold their stake to Essar Power and its subsidiary company at huge profit of Rs 200 crore.

Essar Power had rejected the allegations, saying its acquisition of Nava Bharat Power was "transparent" and NPPL was never its front company.