How Governments and Corporates Collude

Here is a clear example of how Governments in this country work hand in glove with thieving capitalists against the public good. Alok Agrawal of Narmada Bachao Andolan (NBA) reports on how the Madhya Pradesh Government has been colluding with the S. Kumars industrial conglomerate to defraud the public -

The Madhya Pradesh government has joined hands with the industrialists of the S.Kumars group to obstruct the recovery of Rs. 91 crores of public money borrowed by the S.Kumar’s company Entegra Limited from the Madhya Pradesh State Industrial Development Corporation Limited (MPSIDC) causing grievous  loss to the public treasury as well as depriving thousands of ordinary citizens including school-teachers, workers and officers of various governmental and private undertakings and many others who had invested their life-time savings in MSPIDC bonds. This money was borrowed between the years 1997 and 2000. The S.Kumars company Entegra Limited willfully defaulted on the loans taken from the MPSIDC, despite profits, and   S.Kumars dishonored the settlement made by them in 2005, by closing their bank accounts after issuing Rs. 55 crores of post dated cheques in favor of MPSIDC, because of which the cheques bounced. To recover this money the MPSIDC invoked the personal guarantees of Shri Mukul Kasliwal and Warij Kasliwal who had guaranteed the loans given to Entegra Limited and filed a case against them under Section 31  of the State Financial Corporation Act.

It is noteworthy that the MPSIDC won the case when the Bombay High Court by its Order and judgment dated 2 September 2010, allowed the MPSIDC to recover their entire loan with interest from the personal assets from Shri Mukul Kasliwal and Shri Warij Kasliwal. However, surprisingly, when the S. Kumars filed an appeal against the judgment before a Division Bench of the Bombay High Court, the MPSIDC joined the S.Kumars to request the High Court to set aside the favorable judgment and to remand the case back to the Single Bench. This is stated in the Order of the Double Bench of the Bombay High Court dated 10^th January 2011. Further, when the case was remanded back to the Single bench of the Bombay High Court, the Madhya Pradesh Government obstructed the judicial proceedings for the recovery of Rs. 91 crores by taking the plea that they were in the process of settling the loan taken by the S.Kumar’s. Although the entire outstanding sum of Rs. 91 crores can be fully recovered by the judicial process, the State Government has obstructed the same on one hand, and on the other, the Minister Industries Shri Kailash Vijayvargya has recommended in mid 2012 that the S.Kumars need not pay Rs. 53 crores out of Rs. 91 crores outstanding sum.

It may be noted that the loans given to the S.Kumar’s by the MPSIDC were from deposits taken by the MPSIDC from thousands of ordinary citizens including school-teachers, workers and officers of various governmental and private undertakings and many others who had invested their life-time savings in MSPIDC bonds on the promise of assured return of 14.4% on their deposits. However, when neither the principal nor interest on the deposits which constituted the life-time savings of the depositors was returned by the MPSIDC even after a decade, the depositors were forced to agree to an extremely arbitrary and unfair full and final settlement, as per which only 20% of the principal would be paid in 2012, and the rest of the principal in installments up to the year 2019 if the depositors withdraw their cases, and as per which there would be no payment of interest accrued on the deposits (over a 15 year period) whatsoever. Thus the depositors were prevented from using their own savings as their deposits were all consumed by industrialists like S.Kumar’s who refused to return the money borrowed by them.

The Narmada Bachao Andolan condemns this action of the State government of placing 91 crores of public money in jeopardy, and demands that the entire matter be investigated by the CBI and the guilty officials be punished. It also demands that the State Government pursue the case in the Bombay High Court so that the loan may be recovered from the properties of the promoters.

Enquiry at the behest of NBA

It is pertinent to point out that after the favorable judgment of the M.P. High Court was set aside on the consent of the MPSIDC as well as S.Kumars, the NBA sent a letter to the MPSIDC making a complaint about this unethical behavior, and requesting the MPSDIC to immediately change its Officer-n-Charge and Counsel in the High Court, as well as file review. An enquiry was carried out by the MPSIDC, wherein it was stated that the lawyer acted without brief. However neither officer-in-charge of the case nor Counsel for the MPSIDC in the Bombay High Court were changed.

NBA resolves that every penny of money would be recovered from industrialists and given back to depositors

The NBA expresses shock at the enormous injury caused to the ordinary depositors by the mis conduct of the State Government, and the illegal concession sought to be given to the S.Kumars by them, and resolves that it will not rest until every penny of money taken from the MPSIDC is recovered from defaulting industrialists and given back to depositors. The NBA calls on all sensitive citizens to give support in this cause, and intends through a process of non-violent satyagrha, dharna and boycott against the S.Kumars and the other defaulting industrialists to ensure justice to the depositors, and return of entire outstanding public money to the public, whose money it is.

Narmada  Bachao  Andolan
2, Sai Nagar, Mata Chowk,
Khandwa, Madhya Pradesh -450 001
Telefax : 0733 - 2228318
E-mail : nbakhandwa@gmail.com