The Board of Directors of Indian Farmers Fertiliser Cooperative limited (IFFCO) has reportedly endorsed the cooperative’s decision to gift prime properties to its Managing Director Uday Shankar Awasthi and joint Managing Director Rakesh Kapoor in South Delhi as incentives.
The IFFCO Board in its meeting last week also decided to put to vote the issue of Government move to bring the body under the purview of CVC at its shareholders’ meet on May 30.
“The decision to gift house to our MD and Joint MD was not an individual’s decision. Neither was it done in any haste. It was perfectly a legal act that followed not only the Board's approval but clearance from the Annual General Meeting (AGM),” said an official of IFFCO on the condition of anonymity.
Following The Pioneer exposé that IFFCO MD gifted himself a posh bungalow in South Delhi, Awasthi had written a letter to the IFFCO Chairman NP Patel asking him to take back the gifted house. Joint MD Rakesh Kapoor had followed suit. Despite Awasthi’s letter to IFFCO chairman NP Patel offering to return the gifted property, the fertiliser major is yet to apply for transfer of the conveyance deed, which is still in Awasthi’s name.
Following the controversy, the Government had decided to bring it as well as the other fertiliser cooperative Kirbhco under the purview of the anti-graft body Central Vigilance Commission (CVC).
While IFFCO had in a preliminary reply explained the legal position that cooperative where Government has no shareholding cannot be subject to CVC, the 30-member Board of IFFCO deliberated the issue on March 20.
Sources privy to the deliberation said the Board was of the view that cooperatives can be brought under CVC only when the Government amends the Cooperatives Act but considering the seriousness of the matter decided to refer it to its shareholders.
The 40th annual general body meeting (AGM) of shareholders of IFFCO is likely to be held on May 30. The meeting was earlier scheduled for May 13 at NCUI auditorium.
The Board was unanimous on the fact that IFFCO has no direct or indirect Government holding, debt or guarantee and to legally bring it under CVC, the government will have to amend the Cooperatives Act.
The AGM will consider the letter of the Fertiliser Ministry stating that multi-state cooperative societies, IFFCO and Kribhco, fall under its administrative jurisdiction and their decisions as well as members, office-bearers and employees are covered under the CVC Act. The Ministry of Fertilizer is keen on putting the cooperative under direct watch of the CVC.
Awasthi had earlier met Agriculture Minister Sharad Pawar and tried to impress upon that IFFCO did not come within the ambit of CVC.
This is probably the first case of property transaction where the stamp duty for transaction of conveyance deed was paid by the seller itself.