Friday, June 21, 2002, Chandigarh, India


M A I N   N E W S

Panel to probe rice scam
FCI employees go on strike
Chander Parkash and Vijay Mohan
Tribune News Service

Bathinda, June 20
Even as Mr V.K. Singh, Senior Regional Manager, FCI, Punjab region, today rushed to Delhi to personally explain the situation arising out of the export category rice diversion scam, which came to light in the city on June 18, to the higher authorities, dealing with exports, at the FCI head office, the operations pertaining to acceptance and storage of rice from the millers have come to a halt in Mansa and this district as FCI employees have started an agitation in protest against the alleged police high-handedness.

Mr V.K. Singh, who explained the situation verbally to the higher FCI authorities dealing with export, also said that a two-member committee had been constituted by him to investigate the role of FCI officials in the scam. A detailed report would be submitted to higher authorities after the investigation was completed by the committee. He said his verbal report was based on a report published in The Tribune.

While maintaining that strict action would be taken against those found guilty in the scam, he added that he had held a meeting with the Director, Food and Supply, Punjab, for seeking the help of the state government and police to curb such malpractices. He added that about 80 per cent of rice under the export category was sent to Kandla and other ports by rail.

A major scam, running into crores of rupees involving illegal diversion of rice earmarked for export into the local market through an alleged nexus between rice sheller owners, some export firms and employees of the FCI, had been unearthed by the district police authorities on June 18.

Following a series of raids at the local depot of the FCI, and on the premises of a few rice shelling mills, several FCI officials along with a number of truck drivers, contracted for transporting consignments, were rounded up by the police for questioning. The owners of the mills involved in the scam are still absconding. Last night, the police released six FCI officials, rounded up earlier, on bonds. The Assistant Manager, Depot, Mr Hardev Singh, who was arrested, has been remanded in police custody. FCI employees are sitting on a dharna against the alleged harassment of FCI employees by the police after the former formed a Joint Action Committee.

Sources said certain exporters were purchasing high quality rice from the FCI at subsidised rates on the pretext of exporting the same, but were actually selling it to local sheller owners at the prevailing market rate. The local sheller owners would further separate the high quality rice from that stock to sell the same at much higher prices in domestic and international markets while the remaining low grade rice was again diverted to FCI godowns under the garb of delivery of rice in lieu of paddy taken by them from government agencies for milling. The rice was purchased from the FCI at the rate of Rs 576 per quintal, whereas the market rate for the same is stated to be around Rs 900 per quintal. Further, the consignment was also exempted from sales tax.

Following a tip-off, police personnel had swooped down on the FCI depot and six rice mills based in Bathinda district and detected export earmarked rice consignments amounting to 2,000 metric tonnes being illegally diverted to local markets.

A Delhi-based firm, Sharp Menthol India Limited, had presented a release order for 2,000 metric tonnes of A-grade rice for export. As per the release order, dated June 13, 2002, the firm had paid Rs 1.16 crore to the FCI vide a demand draft for the consignment. The consignment was destined for ports at Mumbai and Kandla by road.

Mr V.K. Singh expressed the hope that the strike by the FCI employees would end soon. He opined that action against FCI employees was a result of inadequate knowledge of police functionaries about policy and procedures governing rice exports.

On the other hand, members of the Joint Action Committee pointed out that the strike would continue till all cases registered against FCI officials were withdrawn unconditionally and suitable action against the police officials concerned was taken. The committee has extended its strike till Sunday.

However, the police authorities did not rule out the possibility that this firm was fake and the scam was going on with the connivance of higher FCI officials based in Delhi. Due to the strike by the FCI employees, the police authorities had also been finding it difficult to get more official records for examination.

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