By Our Correspondent
BHUBANESWAR/JHARSUGUDA/NEW DELHI: With the Enforcement Directorate under the Ministry of Finance, probing the Sajjan Jindal-Sanjay Singhal fraud, relating to JSW Steel’s acquisition of troubled debt ridden, Bhushan Power and Steel Limited and subsequent illegal and mysterious transportation of finished goods from BPSL’s plants located in Jharsuguda-Sambalpur Industrial cluster in eastern Indian State of Odisha to Company’s West Bengal and Punjab units, another major scam likely to hit Jharsuguda with reports from Industry watchers in Bhubaneswar, said one Action Ispat and Power Limited , headquarters at Netaji Subhash Place at Pitam Pura in New Delhi, which has closed its plants since past couple of years, reportedly trying hard to defalcate a Bank loan of more than Rs 1000 crore that it had taken from SBI and Canara Bank to run its Odisha plant. The Odisha plant has a capital outlay of Rs. 1330 Crores, the company had said during a MoU signed with Naveen Patnaik led BJD Government decades back.
Sources said Action Ispat and Power (P) Ltd having an integrated steel plant in Odisha’s Jharsuguda, which was closed since past several years, has taken the loan of more than Rs 1000 from SBI and Canara Bank but now the company through some middle men, trying hard to settle the loan with interest by paying only a small amount. “Banks are putting pressure on Action Group , so Company wants to settle the Odisha’s Jharsuguda plant issue that was bearing the loan of more than Rs 1000 crore as the company wants to focus on its New Delhi units,” sources said adding that the Action Group is no mood to re-start its Jharsuguda units putting the lives of some 500 regular and casual workers and officials are at stake.
It is learnt from the sources that promoters of Action Ispat have made a bid to the bankers to settle a debt in excess of Rs 1,200 Cr at Rs 250 Cr vide change of management rules. It is pertinent to note that State Bank of India along with few other bankers have declared the promoters as Wilful Defaulters. If accepted, such an offer would tantamount to huge loss to public money and end of roads for bankers to recover the funds from other businesses of the defaulting promoters.
“With ED grilling BPSL-JSW over Bank fraud and other issues, Action Ispat and Power Limited official website has withdrawn names of its Management Team from its website, apparently fearing any action from either Banks , CBI and ED,” sources said in New Delhi.
The Action Group is engaged in Steel, Power and Computer peripherals to Footwear, Urban Infrastructure Development and Medical Sector. “Like the BPSL-JSW steel scam, ED should also keep a close watch on Action Ispat and Power Limited and its loan defaulter of more than Rs 1000 crore,” sources said. “How can a Bank defaulter settle such a huge amount with Banks, which earlier declared it as a defaulter,” asked an Industry watcher in Jharsuguda.
In September 2013, the office of the Comptroller & Auditor General of India (CAG) had pointed a finger at the Odisha Industries Department for incorrect determination of eligibility of Action Ispat and Power Ltd and 2 others like Vedanta Aluminium Ltd – VAL (Jharsuguda), Bhushan Power & Steel Ltd-BPSL (Sambalpur) for availing electricity duty exemption under Industrial Policy Resolution (IPR) – 2001 . These 3 three companies including Action Ispat and Power Ltd (Jharsuguda) — was recommended for electricity duty (ED) exemption valued at Rs 720.36 crore. Action Ispat & Power Ltd was alone unduly recommended for ED waiver valued at Rs 22.68 crore for its 21 Mw CPP unit.
As per IPR-2001, CPPs are entitled to ED exemption payable for a period of five years from the date of commissioning of the plant provided that no such exemption from the payment of ED is available in respect of power sold or supplied to the users other than the industrial units to which the power plant is captive.Similarly, ED exemption worth Rs 114.48 crore for one CPP units of BPSL of 106 Mw capacity was also inappropriately determined, the audit had pointed out then.
Without wanting to be identified, a businessman associated with materials supply to the industries of Jharsuguda said that Action Ispat and Power Limited had collected raw materials – such as iron ore and coal – illegally without paying taxes for a long time. “A CBI or ED raids in Jharsuguda and New Delhi will expose all illegal network of Action Ispat and Power Limited,” he added
It may be noted here that the ED had also attached assets worth over Rs 4,000 crore of BPSL for alleged bank loan fraud by the company’s former owners. JSW’s bid worth Rs 19,350 crore for BPSL’s plant was approved by the National Company Law Appellate Tribunal (NLCAT) in February this year and the agency was asked to release the assets of BPSL but ED had challenged the NCLAT order taking the matter to Raids and seizers in New Delhi and Gurugram and also the ED, reported that BPSL had engaged in clandestine clearances of finished goods from its Plants at Jharsuguda-Sambalpur belt in Odisha to its plants at Kolkata in West Bengal and Chandigarh in Punjab. Goods valued at Rs 700 crore had been cleared without payment of applicable taxes and duties and without issuance of any statutory invoice,” the ED said in the statement. BPSL’s plants in Odisha was a killing field as hundreds of workers died in the plant in several mishap.
