The NGO alleges that the government was buying sugar at Rs 9.65 per kg higher than the market price, palmolein by Rs 17.6 per kg, and dal by Rs 28.5 per kg to favour a firm which got the tender illegally.

Chennai NGO alleges Rs 1500 cr civil supplies scam seeks Food Mins resignation
news Corruption Sunday, January 26, 2020 - 18:42

Chennai-based NGO Arappor Iyakkam launched a campaign on Sunday demanding action against Food Minister R Kamaraj and Tamil Nadu Civil Supplies Corporation managing director Subha Devi for an alleged civil supplies scam to the tune of Rs 1,500 crore in the state. The anti-corruption organisation has found out through RTIs that the tender conditions for the procurement of goods for the Public Distribution System (PDS) were rigged to favour a particular group of companies and the final prices of goods exceeded the market value of products by Rs 10-Rs 30.

The firm prominently mentioned by the NGO as part of this alleged scam is the Christy Friedgram group. The group had earlier been the subject of similar scrutiny when the Income Tax Department unearthed documents that exposed an alleged nexus between the firm which supplied material for Tamil Nadu’s flagship noon meal scheme and politicians, bureaucrats and their associates.

Reports suggested that the Tiruchengode-based group and its employees revealed payment of kickbacks to the tune of Rs 2,400 crore to politicians and bureaucrats.

This time around, Arappor Iyakkam's allegations regarding the group include - “Alteration of Tender conditions prequalification criteria to favour select set of firms related to Christy Friedgram group, conspiracy leading to Corruption among public sector enterprises and select set of firms related to Christy Friedgram group and abnormally high rates for products set by the group for essential foods being sold.”

In a petition to the Central Bureau of Investigation regarding its findings, Arappor alleges that sugar was being bought from Christy Friedgram at Rs 9.65 per kg higher than the market price, palmolein by Rs 17.6 per kg, and dal by Rs 28.5 per kg.

"The modus operandi used in this corruption is unique. Many firms were participating in the Sugar, Dhal and Palmolein tenders until a few years back. When the firms related to Christy Friedgram group entered the competition, the public servants of TNCSC change tender conditions to allow a select set of firms related to Christy Friedgram group alone to compete and exclude all the bidders who were supplying to TNCSC until that point of time," alleged Jayaram Venkatesan, convenor of Arappor Iyakkam.

"The select set of firms win tenders because their own group of firms which are related parties alone are made eligible to participate in the tender. They use this advantage and all the related parties quote at much higher rates than market rates for one amongst them to win tenders," he adds.

In an effort to protest this alleged corruption, the NGO will now be sending “Rs 0 notes” to the Chief Minister and to the Tamil Nadu Civil Supplies Corporation.

"Government employees draw salaries from what we pay to them as tax. This is a symbolic manner of saying that we will not just stand by and keep paying them for working against citizens," says Jayaram. "We will further be demanding that the Food Minister be sacked and that those involved be brought to the law for their corrupt practices,"  he adds.