GSPC never defaulted on repaying loans to banks: Guj minister

The Gujarat government today said the State Petroleum Corporation (GSPC) never defaulted on repaying loans, a day after the Congress alleged that the state-owned company owed Rs 12,000 crore to various banks.

State Energy Minister Saurabh Patel said there was no question of declaring the GSPC bankrupt as per the RBI rules.

"The allegation that GSPC's KG Basin venture is a scam is baseless, as the CAG (Comptroller and Auditor General) had never ever alleged any intentional wrongdoing or irregularities in the conduct of the GSPC business," Patel said in a statement.

Congress leader Jairam Ramesh had yesterday alleged that the GSPC owed Rs 12,000 crore in loans to various banks.

Addressing a press conference in Delhi, Ramesh had accused the Narendra Modi government of trying to prevent the company from being declared bankrupt.

Citing CAG reports, Ramesh had claimed that a Rs 20,000-crore scam has come to light in the GSPC.

Patel said the Opposition party either lacked the "ability to understand nuances of the business of hydrocarbons exploration or perhaps they don't wish that India attains self-dependency in the hydrocarbon sphere".

He accused the Congress of having an "anti-Gujarat psyche" and of "running a campaign of fallacies on the KG Basin project of the GSPC".

Ramesh had also cited an RBI circular which stated that if a company owed banks more than Rs 2,000 crore as on March 1, 2018 and in case of default, that company should be declared bankrupt after 180 days.

Patel said the circular is applicable only when two conditions---when the outstanding loan amount is in excess of Rs 2000 crore and if there is a default in the loan account--are fulfilled.

"Loan were advanced to the GSPC from time to time only after requisite approval from the respective board of directors of banks. GSPC has always been servicing its loans, including payment of interest and repayment of principal amounts," Patel stated.

He stated that the GSPC never defaulted on any of its commitments to pay loan, "not even for a single day".

Patel claimed the CAG reports cited by the Congress leader do not disclose any scam.

"GSPC has always acted as a responsible business entity and even the CAG has never ever alleged any intentional wrongdoing or irregularities in the conduct of business of the GSPC," he said.

The minister said the erstwhile UPA government at the Centre had appointed auditors who checked accounts of the KG Block, which he said was awarded to GSPC "pursuant to international competitive bidding".

Speaking on Ramesh's charge that the Central government had filed an affidavit in the Allahabad High Court against the RBI circular, Patel said the case before the HC has nothing to do with GSPC.

"The case is only limited to companies in the power sector and has been filed by private power producers against the RBI's circular. This entire issue before the Allahabad HC has nothing to do with GSPC" Patel said.