Sale of sugar mill scrap under CAG scanner

The UP government has sold off scrap and other obsolete plant and machinery of a closed sugar mill at Rae Bareli,the land of which is to be used for establishing AIIMS-like institute,at more than Rs 9 crore.

Written by SURBHI KHYATI | Lucknow | Published:May 17, 2013 2:19 am

The UP government has sold off scrap and other obsolete plant and machinery of a closed sugar mill at Rae Bareli,the land of which is to be used for establishing AIIMS-like institute,at more than Rs 9 crore. The previous BSP government had,meanwhile,sold land,building and plant and machinery of at least five similar mills at throwaway prices of less than Rs 5 crore each.

The scrap and plant machinery of the Nandganj Sihori Sugar Corporation Limited in Daryapur,Rae Bareli,which was a closed mill belonging to Uttar Pradesh State Sugar Corporation Limited (UPSSCL),was sold off earlier this month for Rs 9.35 crore through open bidding. The price was 62 per cent more than the estimate of Rs 5.76 crore.

“The bidding was for two items — the old used brass tube which was sold for Rs 1.24 crore and another of obsolete plant and machinery and other movable items which were sold for Rs 8.11 crore,” said a senior official of UPSSCL.

Source said the estimated value of the land of the mill was assessed by the government approved valuer at Rs 82 crore. The government has decided to give the land,which is 98.3 acre,along with another 49.85 acre from nearby Aiyma and Dariyapur village of Sultanpur,to the GoI free of cost,to establish an AIIMS-like institute in Rae Bareli.

In comparison,as already pointed out by the Comptroller and Auditor General of India,the Mayawati government in 2010-11 had sold off a total of 21 sugar mills in the state,of which 10 were operating at the time of sale while 11 were closed,at throwaway prices.

The CAG report says the state did not only undervalue the sugar mills,but also sold them at lesser prices than estimated value.

Of the 11 closed mills,three mills of Kushinagar and one mill each of Deoria and Barabanki were sold for less than Rs 5 crore. The best value was for a closed sugar mill,at Rs 14.11 crore. The CAG had said in its report that there was a complete lack of competition in the bids for these mills. Of the total 21 mills,the maximum of five mills were purchased by Wave Industries and Indian Potash Limited each.

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