Gadkari under CAG fire for Rs 49-crore Purti loan, Cong wants his ouster
CAG reports – that had become the bane of the previous UPA administration – came back to haunt the BJP-led government on Friday, with the Congress demanding the resignation of highways minister Nitin Gadkari after the auditor nailed his firm for violating norms.Updated: May 02, 2015 00:49 IST
CAG reports — that had become the bane of the previous UPA regime — returned to haunt the BJP-led government on Friday, with the Congress demanding the resignation of Union highways minister Nitin Gadkari after the auditor highlighted violation of norms by his firm.
In a report tabled in Parliament, the Comptroller and Auditor General detected violation of norms in a loan given to Purti Sakhar Karkhana Ltd by the state-run Indian Renewable Energy Development Agency (IREDA). The loan was given in March 2002 for a 22-MW co-generation project in Nagpur which was to be run on bagasse, a biofuel extracted from crushed sugarcane.
In the report, the CAG named Gadkari as one of the “promoter/director” of the company.
According to the report, one of the norms violated was that the project — which received loans and subsidy for generating renewable energy — was converted into a 100% coal-based project in less than 30 months of being completed.
Congress spokesperson Abhishek Singhvi on Friday demanded that Gadkari put in his papers and face a judicial inquiry. “The BJP used to attack the previous UPA government based on CAG reports that hadn’t even been released. Now that the CAG has published this report, Prime Minister
Narendra Modi and the BJP should take cognisance of it,” he said, seeking to use the CAG report to turn the tables on the NDA government.
According to the CAG report, the IREDA loaned Rs 48.6 crore to Purti Sakhar Karkhana Ltd on a personal guarantee of the directors/promoters of the firm, including Gadkari.
After delays, the project was commissioned on March 18, 2007 and classified by IREDA as a non-performing asset (NPA) barely 13 days later.
The NPA tag entitled the firm to a discounted repayment norm. Of the Rs 84.12 crore it was to pay back to IREDA including the interest, the state-run agency settled for Rs 71.35 crore. According to the CAG, the remaining Rs 12.77 crore had to be sacrificed.
Gadkari could not be reached for comments. But in a statement, Purti Power & Sugar Ltd said the firm — which had already explained its stand to CAG — said it had already settled the outstanding loan as per one-time settlement (OTS) norms.
But if the IREDA management still has some questions, the company will promptly comply to their satisfaction, the statement added.