Bat Officials May Be Grilled On Role In 3 Itc Divisions

BAT officials Malcolm Fry and Richard Pilbeam, currently on the ITC board, and and Norman Davis, who was the previous BAT nominee, are expected to fly in later this week, and may be questioned, diplomatic protocol permitting, on a possible BAT involvement in the Agri-Business Division (ABD), Indian Leaf Tobacco Division (ILTD) and Indian Tobacco Division.

The officials expect to corroborate their findings on exports related to Indian Leaf Tobacco Division (which were allegedly underinvoiced) through interrogation of BAT officials.

While the directorate has not yet evaluated the extent to which underinvoicing in ILTD was done, they do not have sufficient evidence to pin BAT down.

 

ED sources said the summons to BAT nominees have been issued as part of the overall investigation, as the department wants to ascertain the role of the parent company, as well as that of the individuals in their personal capacity, in ITCs activities.

This is meant to put things in perspective as well as to gather further evidence.

According to ED sources in Delhi, the directorate has already written separately to the ITC headquarters in Calcutta asking the BAT nominees to present themselves for questioning.

Meanwhile, the enforcement directorate has formally written to BAT chairman Michael Brough-ton for questioning of these officials at India. Enforcement directorate deputy director K K Kabirpanthi said the ED is awaiting BATs official response.

The directorate is probing a possible BAT involvement, as some decisions, according to the Lovelock & Lewes special audit report completed in late 1995, were taken by ITC at BATs suggestion.

The report points out that some of BATs instructions to ITC resulted in heavy losses to the Indian tobacco firm.

Mentioned in the report is the fact that at BATs insistence, the execution of an order from Iraq for supply of 50,000 tonnes of rice was stopped in June 1992 because of the Gulf war. Since Britain belonged to the side of the US-led allies, it did not favour such a deal.

By this time, ITC had already purchased 101,977 tonnes of rice in two batches to honour this deal and two others which it had to abandon at the behest of ITC London.

This had left ITC with a huge stock of 84,000 tonnes of rice which it was hard put to dispose.