The Hindu Business Line : SAIL's coal purchases under lens

CERTAIN spot purchases of coal in the US market, by Steel Authority of India Ltd (SAIL), have led to the Steel Ministry scrutinising the role of Mr S.K. Roongta, the company's Director (Commercial), in the transaction.

Since SAIL is a Schedule A public sector company, any punitive action against him will require the clearance of the Appointments Committee of the Cabinet, headed by the Prime Minister, Dr Manmohan Singh.

Dr Singh is currently in Mauritius and is expected to return on Saturday.

Transactions that have come under investigation relate to spot purchases made by SAIL between April and August 2004 in the US market.

During this period, company sources said, the coal position in the four integrated plants of SAIL was very tight and its long-term supplier had invoked the force majure clause because of roof collapse at its mines. "The plants were almost running out of stock and the international market situation was very tight. Offers in the spot market were valid for very short periods, thereby, requiring prompt decisions," company sources said.

As per normal procedure, SAIL has a purchasing committee called Coal Empowered Committee, headed by the Director (Commercial), and comprising the Director (Finance), the Director (Technical) and a Joint Secretary of the Steel Ministry.

It could not be immediately confirmed whether this committee met to approve the purchases or the Director (Commercial) took the decision independently.

The issue of spot purchases first came to the notice of the internal audit department of SAIL, which found that coal was available at prices lower than what had been contracted.

A subsequent Government audit also confirmed the finding, sources said. The issue was then referred to the Steel Ministry in December.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
GDP slows to 6.2% in Q3 on lower farm output

Current account deficit up at $5.47 b in Oct-Dec '04

Foreign investments account for 40% of reserves accretion

Captive power starts flowing into grid — PTC begins with Jindal unit

SAIL's coal purchases under lens

Markets end fiscal on buoyant note, Sensex up 111 points