BJP MP Nishikant Dubey has written a letter to Prime Minister Manmohan Singh citing gross functional irregularities at the Multi-State Cooperative Society — Indian Farmers Fertiliser Cooperative Society (IFFCO) and “siphoning of money and money laundering activities” of its Managing Director Uday Shankar Awasthi.
In the letter, BJP MP Nishikant Dubey has requested the Prime Minister to take note of the large number of financial frauds being perpetuated by the Iffco MD. He has sent a copy of the letter to Chemical and Fertilisers Minister Srikant Jena. The Pioneer has exposed how IFFCO MD and his immediate deputy gifted prime properties in south Delhi to themselves. MD and the Joint MD were forced to return the sale deeds of the two prime properties to the IFFCO board after Central Vigilance Commission (CVC) probe in to the matter.
In his letter, BJP MP has accused that the current cash flow position of IFFCO smacks of serious problems. “On one hand, IFFCO shows reserves and surplus of Rs 4,270 crore ending March 2010, then why it is borrowing more than Rs 10,000 crore for the working capital to sustain a turnover of Rs 16,808 crore for the year 2009-10. There appears not only gross mismanagement of funds but at the same time siphoning off money and fabricated balance sheet,” the letter said.
“Similarly, IFFCO is making wrong disclosures in violation of Established Accounting Practices. During 2008-09, IFFCO showed in the balance sheet interest earning of Rs 145.3 crore on fertiliser bonds issued by Government of India and booked a loss of Rs 83.16 crore in the year ending March 2009. While in 2009-10, IFFCO showed only the interest income on the bonds Rs 442.16 crore but at the same time it should have booked a loss for undervalue of current asset approximately Rs 250 crore thereby bringing the profit to less than Rs 250 crore. This practice has been followed as a transparent policy for all the stakeholders by all the fertilisers companies. Thus, IFFCO is misleading the stakeholders especially the banks,” BJP MP alleged in his letter.
BJP MP also accused the IFFCO MD of colluding with the lok Janshakti Party president and former Fertiliser Minister Ram Vilas Paswan during last elections. “Awasthi seeks favours from political parties by extending donations in a camouflaged way, in violations of the MSCS Act (Multi-State Cooperative Societies Act). In the last elections to appease lJP, he sanctioned his State Marketing Office, Bihar, Rs 10 crore for tube well development but the money was to be given to a specified contractor nominated by the lJP,” he stated in his letter.
He further alleged, “US Awasthi is MD of IFFCO since last 17 years since 1993. He has already attained the age of superannuation 65 years but even one year before expiry of the term he got his term extended to five more years.”
“It is further interesting to note that remuneration to Awasthi increased to Rs 73 lakh for the year 2010 from Rs 25 lakh in 2009 and all other eight functional directors spent just the double of MD and it went up from Rs 1.04 crore to Rs 1.55 crore. A lavish life style but yet huge amount of expenditure on charterting place for MD is booked in other accounts,” the letter said.
Dubey has demanded the PM to institute a “forensic audit” of IFFCO accounts and instruct Directorate of Enforcement to “expedite probe in conjunction with EoW to investigate the cases of money laundering” in firms linked to IFFCO and “FDI made by Catalyst Business Solutions, a firm owned by Awasthi’s sons”.