Until the news of bribery charges in the Tatra truck sale case broke out in March this year, the suspended chairman and managing director (CMD) of BEML Ltd, V RS Natarajan, was a very happy man.
He was entering the last year of his eventful decade-long career with BEML Ltd, the defence public sector undertaking which he helped grow its top line 2.5 times in 10 years. He had also set the ambitious goal of achieving Rs 5,000 crore sales in 2012-13 and Rs 10,000 crore by 2018.
Joined on December 1, 2002, Natarajan served BEML as CMD for a record 10 years. Since assuming office, he put the company on fast-track of growth in terms of sales, profit, expansion and diversification.
The company’s sales grew 2.5 times to Rs 3,615 crore in 2011-12 from Rs 1,424 crore in 2001-02. Net profit touched an all-time high of Rs 269 crore in 2008-09, showing a growth of 54 times over Rs 5 crore reported in 2001-02.
According to industry analysts, Natarajan played a key role in turning around BEML from a mere earthmoving equipment and rail coach maker to a company with diversified interests in vast areas such as defence, rail and metro, mining, construction, aerospace, dredging research and development. The PSU is currently betting big on the modernisation of the Indian Army and hoping to ride the boom in the metro rail sectors in Indian cities.
Till then, everything was fine. The Tatra truck scam, however, raised eyebrows about the way Natarajan ran the company.
In March, former Army chief General V K Singh alleged he was offered Rs 14 crore bribe by a former Army officer to clear supply of a tranche of 600 Tatra trucks supplied by BEML to the Army.
Subsequently, defence minister A K Antony approved Natarajan’s interrogation by the Central Bureau of Investigation (CBI).
The probing agency questioned him many times in the Tatra case along with Ravi Rishi, chairman of Vectra group that supplied complete knock-down kits to BEML to make Tatra trucks.
The main charge levelled against BEML is that it imports the truck for around Rs 20 lakh and sells it to the Army at almost three times the cost. The Tatra trucks, being made by Czech major Tatra, were supplied to BEML as completely knocked down kits. The Indian company would assemble the trucks by at its Bangalore, Kolar Gold Fields, Mysore and Palakkad units. This has been allegedly going on for many years.
CBI grilled Natarajan in April and found several documents against him in the case. It was not the first time that Natarajan was interrogated by CBI. Earlier, the investigating agency had booked him for cheating, criminal conspiracy and corruption in connection with tendering the process for hiring a private consultancy firm for BEML.
BEML has been supplying Tatra trucks for use in the defence forces since mid 1980s. It had entered into an agreement in 1986 with Czech Republic’s Tatra.
Natrajan got into more troubles, when he told reporters in Bangalore that he would file a defamatory case against former Army chief Singh, if he did not apologise for his corruption allegations in BEML. Singh had accused BEML of supplying substandard trucks to the Army. The Ministry of Defence subsequently asked Natrajan to explain the statement on the army chief. He was later suspended by the defence ministry on Monday on a recommendation from CBI
The charges against BEML may not result in losing business for the company from the armed forces, but it has certainly resulted in a loss of face for the man who is credited with turning around the company. CBI is likely to arrest Natarajan in the case for further interrogation.