Multi-Crore Scam: CBI Arrests Former Paper Mill Officials

The CBI alleged that inflated prices were paid to DHAC.

SEATTLE (Scrap Monster): The former senior officials of Hindustan Paper Corporation Limited (HPCL) have been booked by the Central Bureau of Investigation (CBI) department. They were allegedly involved in a multi-crore scam in connection with purchase of papermaking raw materials.

The arrested officials include former chairman-cum-managing director MVN Rao, director (operations) SN Bhattarcharya, director (finance) Amitabh Banerjee and company secretary LR Ekanath of HPCL.

According to case filed against them, the above said officials were part of irregularities in procurement of bamboo pulp from the Dima Hasao Autonomous Council (DHAC), Assam by Cachar Paper Mill (CPM). HPCL had reached an agreement with DHAC towards supply of bamboo for a period of 30 years.

The agreement, which came into effect in 1982, had validity until 2012. However, a supplementary agreement was signed in 2006, under which a subcontractor, Hill Trade Agency (HTA) was appointed for cutting and transporting bamboo. This led to huge increase in the supply rates and transportation costs.

The CBI alleged that inflated prices were paid to DHAC. The officials from both sides met several times on fixing prices.