WB govt seeks six month's time to repay principal loan amount

The Mamata Banerjee government has sought six month's time from nine nationalised banks to repay the principal amount of the loan taken by erstwhile Left Front government in 2004-05 for supplying iron ore to a China-based firm.
"We will soon hold a meeting with the banks and tell them of our inability to pay them the interest amount. We will only be able to repay the principal amount taken from them by the Left Front government for supplying iron ore to China," West Bengal Food Supplies department minister Jyotipriyo Mallick today said.
The West Bengal Essential Commodities Supply Corporation Ltd (WBECSC) during 2004-2005 had taken loan of over Rs 370 crore from nine nationalised banks for reportedly exported inferior quality iron ore to a China-based firm.

The export consignment was rejected but it never reached back Kolkata and the Corporation Ltd lost more than Rs 300 crore.
It was learnt that a consensus was reached between the WBECSC and consortium of the nine nationalised bank that Rs 232 crore and 42 lakh (including both principal and the interest) would be paid in seven instalments in the period between October 2007 to October 2017.
The Cabinet had agreed that the state government would be the principal guaranteer for the repayment of the loans to the nine nationalised banks.

However, after paying Rs 75 crore, the WBECSC had failed to make any further payments to the consortium following which it moved to Debt Recovery Tribunal (DRT) in 2009.

In fact, Bank of Maharashtra had appointed one Interim Resolution Professional (IRP) and started Corporate Insolvency Resolution Process, for the recovery of its Rs 27 crore and 93 lakh as per the Insolvency and Bankruptcy Code 2016.
Following which the Interim Resolution Professional (IRP) had freezed all bank accounts of the WBECSC, Mallick said.
"On the request of our officers the bank accounts were reopened for the period of another six months as per the time limit for resolution of the dispute as per the Act," he said.
In fact, the state government expects that the investigations into the multi-crore iron ore scam that took place during the erstwhile Left Front rule in West Bengal may be over in another year's time.

"We think that within another one year investigations into the multi-crore iron ore scam will be over and the entire story will be clear to us," Mallick said.
"The CID is working very efficiently and quickly and hopefully the investigation would be over in a year's time. But because of the investigation is yet to be over we cannot speak much on it," he said.
It must be recalled that that Naren De's successor Paresh Adhikari had lodged the complaint following a departmental inquiry in 2007.
Kolkata Police detective department had arrested two senior officers but the subsequent chargesheet could not directly implicate those at the helm of WBECSCL or the food and civil supplies department. After Trinamool Congress came to power CID was asked to probe the case afresh.

Besides, six IAS officers, over 40 others including chairman, commissioner, managing directors, principal secretaries, and two former ministers both in-charge of the food and civil supplies department in different period - Kalimuddin Shams and Naren De, were allegedly involved in the multi-crore iron ore scam in 2004-05.
The CID has been investigating into the scam and has already grilled De and arrested IAS officers the then managing director of the essential commodities services department Debaditya Chakraborty, the then director general of the food and civil supplies department RN Jamir for their alleged involvement in the scam.
Though the decision was taken when Kalimuddin Shams was the Food minister, the export was done when De was at the helm at Khadya Bhawan.