Tuesday, Sep 16, 2014

Govt refuses to disclose deal with Tata Motors, calls it ‘confidential’

Tata Group chairman Cyrus Mistry with CM Anandi Patel in Gandhinagar on Tuesday. (PTI ) Tata Group chairman Cyrus Mistry with CM Anandi Patel in Gandhinagar on Tuesday. (PTI )
Express News Service | Gandhinagar | Posted: July 23, 2014 3:24 am

The state government on Tuesday refused to disclose the agreement it has signed with Tata Motors Limited calling it a “confidential” agreement. The government has signed an agreement with Tata Motors under which the latter has been getting loan of the equal amount from the former on the gross value added tax (VAT) it paid on the sale of the Nano car manufactured in Gujarat. State Finance Minister Saurabh Patel did so while stating that it was a “confidential” agreement.

The government’s act of not disclosing the “confidential” coincided with the Tata group’s chairman, Cyrus Mistry, paying a courtesy visit to Chief Minister Anandi Patel. The issue had cropped up in the Question Hour session at the Assembly when Congress MLA from Viramgam constituency, Tejashree Patel, asked about the amount of loan given to Tata Motors by the government against the gross VAT the company paid to it on the sale of Nano car in the past two years.

Replying to Patel’s questions, the finance minister said that the government has entered into an agreement with Tata Motors and as per the agreement, the company has been given loan of Rs 419.54 at 0.1 annual interest rate.

Following this, Chief Whip of Opposition Congress Balvantsinh Rajput had sought details of the agreement while also demanding if the government wanted to put it on the table of the House. To this, Saurabh Patel said, “The agreement is confidential. I will have to see if it can be put on the table of the House or not.” The subsequent queries of Congress MLAs on the Nano project and its manufacturing in Gujarat created a lot of furore in the House. At one point, Leader of the Opposition, Shankersinh Vaghela, stood up and asked the finance minister if the loan was being given on the sale of only Nano. The minister said that the loan was being given only on the production of Nano.

Vaghela then said that the agreement could not be confidential and that it should be tabled in the House. Though, the issue died at this point with the Speaker calling for the next question.

Notably, a public interest litigation was also filed before the Gujarat HC in this regard with allegations that the automobile company was getting undue benefit of the said agreement with the state government while causing huge loss to the state exchequer. However, a division bench of the HC had, in April this year, dismissed the PIL. Tata Motors Nano manufacturing plant in Sanand was commissioned in Gujarat in April 2010 after the company shifted it from Singur in Bengal following violent protests there.

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