PCL slapped with 11-yr World Bank ban for fraudulent practices

Don't want to miss the best from Business Standard?

World Bank has banned Progressive Constructions Ltd (PCL), founded by Union Textiles Minister and Congress leader K Sambasiva Rao, for at least eleven years for engaging in "fraudulent practices" in execution of three contracts for a National Highway project.
During the sanction period, which would extend to all legal entities directly or indirectly controlled by PCL, the company would not be able to work on any World Bank-financed projects, the multilateral lender said in an order.
Calls made to PCL office in Hyderabad for their comments did not elicit any reply, while phone calls and messages sent to Rao also remained unanswered. However, sources close to the Minister claimed that he is not involved in operations of the company since 1983 and it is being run by his daughter.

According to the Bank's three-page order, passed on November 26, 2013, PCL was found to have "engaged in sancationable practices" in connection with the Lucknow-Muzaffarpur National Highway project.
PCL was charged of having "engaged in fraudulent practices in connection with its execution of three Bank-financed road construction contracts by submitting numerous fraudulent documents misrepresenting" the company's use of mobilisation and materials advances, the bank said.
While the World Bank has not named any promoters or top officials of the debarred company, PCL's website shows Rao, currently Textiles Minister in the Union Cabinet, set up Progressive Engineering Company as a partnership firm in 1966.

With expansion into other areas, this company was transformed into a Private and a Limited Liability entity in 1982, resulting into creation of Progressive Constructions Limited, the website says.
PCL is engaged in infrastructure building for sectors like irrigation, power, rail, transport, housing and industrial establishments and is currently headed by Srivani Mullapudi, its Managing Director.