CBI books BEML chief on charges of cheating, corruption

Friday, April 20, 2012: The Central Bureau of Investigation (CBI) has booked Bharat Earth Movers Limited (BEML) chairman VRS Natarajan for alleged cheating, criminal conspiracy and corruption in connection with the tender process for hiring a private consultancy firm and carried out searches at several locations including his residence in Bangalore.
The case relates to awarding contract for the implementation of Enterprises Resource Planning Project in the public sector undertaking during 2004-09. The agency has now named Mr Natarajan and Coimbatore-based Astral Consultants’ Director CS Srivatsan as accused in the case.
According to the CBI probe, Mr Natarajan and Mr Srivatsan were part of the alleged criminal conspiracy to award work worth Rs. 40 crore to Astral Consultants.
“It is alleged that the accused persons were parties to a criminal conspiracy entered amongst themselves at Bangalore and other places during 2004-09 to cheat BEML in the matter of award of different works relating to the implementation of Enterprises Resource Planning Project in BEML causing wrongful loss to BEML and wrongful gain to others,” said the CBI spokesperson.

Just two days ago, Mr Natarajan was grilled by the investigation agency for over eight hours. The extensive questioning on Tuesday was however to do with the CBI’s probe into the Tatra-Army trucks deal case. BEML or Bharat Earth Movers Limited is one of India’s biggest defence public sector units based in Bangalore. Tatra is a Czech truck manufacturer which supplies parts to BEML. The trucks are assembled at BEML and sold to the Army. Tatra deals with the Army came under scanner after Army Chief General VK Singh disclosed last month that he was offered a bribe to clear “sub-standard” trucks. The Army has bought 7000 Tatra trucks since 1986.
Mr Natarajan is not an accused in the Tatra case. The CBI only wanted him to clarify his stand on certain decisions that were taken by the BEML while signing memorandums of understanding (MoUs) with Tatra.
There is also a third headache for Mr Natarajan. NDTV has accessed an internal report of the Criminal Investigation Department’s legal division in Hyderabad which opines that criminal action can be taken against him for cheating, criminal breach of trust and falsification of accounts.
The CID is investigating allegations and counter allegations made by BEML and its joint venture partner Midwest Granite, where both companies have accused the other of cheating, causing losses and misappropriation. BEML-Midwest is a Joint Venture Company (JVC) was promoted in 2007 to explore the mining sector.
The report says Mr Natarajan “became self-centred and started doing business for personal benefits… He also deliberately suppressed facts and dishonestly transferred the loss, by making the contract from his parent company (BEML) to the JVC due to which the latter was put to Rs. 2 crores loss.”