PROJECT SCAM: Free Run of/by/for the SAIL officials
Will Plates open another Pandora Box?
The production of TMT Bars in India is about 50 million Tonne per annum, whereas that of Plates is about 10 million Tonne per annum. Out of the above annual production capacity of SAIL is about 3.0 million Tonne and 3.5 million Tonne respectively. At the same time where sales of TMT are strictly not allowed to Traders, SAIL officials are allowed to sell plates to them. With the above background, it is agreeable that sales of Plates to Projects to non-Projects would be lower than that of TMT, but given the approach and temperament of SAIL officials the volume of Plates could also be substantial.
Distributor in JSW Steel but Project in SAIL
Kanunga Extrusion Pvt Ltd (KEPL) KEPL is a Bengaluru based JSW Steel Distributor which provides a wide range of steel products to meet diverse customer needs. The products include Hot Rolled Steel grades like E 250, E 350, SS 400, Fe 410, Fe 490, and BSK 46, along with HRPO options such as IS 1079 D, SAPH 440, SPFH 590, and BSK 46 ; Cold Rolled options, covering base grades like IS 513 D, EDD, and special grades like SPFC 590, JSC 440; Stainless steel grades from the 200/300/400 series; GP Coils in different grades and spangle types; structural steel range comprises products like MS Angle, MS channels, ISMC, ISMB, MS flats, and MS rods etc.
When Vinod Gupta was the Regional Manager of Southern Region of SAIL CMO, SAIL entered into a PROJECT MOU with the above firm w.e.f. Aug 01, 2020 at its Bengaluru branch for 15,100 T. Although a trader alias FAKE PROJECT, it has been gathered that over 5,000 T of steel primarily PM Plates were sold to the firm at heavy discounts using the DoP available for Genuine Projects. It has been further gathered that supplies were only till Gupta was the Regional Manager there. It may be noted that around April 2021, Gupta was promoted to Executive Director and moved to Delhi as Head of Commercial.
What process was followed to select Kanunga Extrusion Pvt Ltd to give subsidised steel?
How Gupta zeroed in to Kanunga Extrusion Pvt Ltd to give steel on heavy discounts?
Till date it was being seen that primarily TMT Bars have been sold to the FAKE PROJECTS, but now sources are claiming that Steel Plates have been used as the other Key Product to illegally pass heavy discounts to a number of private firms in the name of projects. A large number of such cases have surfaced. Although in case of TMT Bars, it was only the favourite traders which were camouflaged as Projects, for Plates both favourite traders and chosen consumers have been masked as Projects by SAIL officials to surreptitiously employ the DoP given to them by SAIL exclusively for genuine projects. Apart from Plates, SAIL officials also sold HR Coils in the name of Projects as the same can be cut into plates on a suitable shearing line.
Broadly speaking, all traders are the same i.e. they buy steel from SAIL and sell in the market with or without minor value additions for profit or at times for windfall gains. On the other hand, all consumers are not the same in this case. Varied kinds of value additions are carried out by consumers on the raw steel purchased from SAIL. Here consumers of Plates (and HR Coils) also include Wagon builders / manufacturers; Railway Component / Equipment manufacturers Pre-engineering Building manufacturers; Equipment manufacturers; OEMs; Machinery manufacturers; Container manufacturers; Large Dia Pipe manufacturers; Manufacturers of Construction & Handling Equipment / Machinery like Jaw and Cone Crushers, Road Pavers / Millers; Crane manufacturers etc. etc. etc. There are cases where the promoters / owners of the so-called consuming / user firms have trading firms also in different name(s). Sources say that although separate policies were available for sales to traders as well as consumers, still they were made Projects.
Here attention of the readers is also drawn to an important aspect. Even if many of the above may be actual consumers / users but at the same time many of them are also exporting their end product to various countries made out of the steel purchased in the name of Projects at discounted prices. It results in a larger violation of the policy guidelines as the provision of additional discounts for Genuine Projects was probably made to give a push to the infrastructure in India.
Also read two related stories on Vinod Gupta
https://www.bureaugram.com/news/sail-project-scam-vinod-gupta-ye-dil-mange-more
It has been gathered from sources that during the supply period V Sasidhar was the Regional Business Manager for Flat Products for Southern Region. From two years, he is on deputation to RINL, sent by SAIL on directions of the Ministry of Steel, to help RINL come out of the distress. One can very well gauge what kind of professional help such officers can impart to the ailing steel producer. Sources claim that a South Indian sent to South India, there was no other consideration for SAIL to send him to RINL, Vizag. It is noteworthy that except for about a short spell of three years which included two tenures at two different locations, he spent his entire career in CMO in South India till becoming CGM at locations which include Vijayawada, Bengaluru, Vizag, Coimbatore and Chennai. Height is that from Coimbatore he was sent to Faridabad but within a year he managed his transfer to Chennai.
(The above article has been written based on Bureaugram’s extensive research and inputs from various sources including sources from SAIL)
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