Dot Continues Business With Blacklisted Firms

The department of telecommunications (DoT) is continuing business with 14 equipment suppliers allegedly involved in price scams, despite action being initiated against them to ban business activities.

While allegations of price cartelisation have been levelled against some of the 14 suppliers, others have been accused of being involved in questionable equipment purchase deals during the tenure of former communications minister Sukh Ram.

Giving out a list of the companies in the Lok Sabha yesterday, communications minister Beni Prasad Verma said an inquiry officer has been nominated by the DoT to pursue the show cause notices. The 14 firms are Sterilite Industries, Birla Ericsson Optical, Himachal Futuristic Communications Ltd, Bhillai Wires, Aksh India, Uniflex Cables, VHEL Industries, Gujarat Optical Communications, Surana Telecom, Plasma Machine Manufacturing, Siemens, RPG Telecom, Telematics Systems and Advanced Radio Masts (ARM).

 

However, the written reply did not state the progress of the show cause notices. Most of these firms were allowed to participate in a Rs 250 crore optical-fibre tender after they were accused of price cartelisation in a previous tender. Recently, DoT shortlisted Siemens among several Indian and foreign firms for a Rs 750 crore digital switch contract.

Hyderabad-based ARM is accused of selling radio masts for the DoTs rural telephony project at an inflated price. One of the cases filed against Sukh Ram is that he favoured ARM while awarding an order for multi-access rural radio (MARR) equipment. The former Union minister was alleged to have cleared the contract to ARM despite recommendations to the contrary by DoT officials.

The department had taken a decision to blacklist ARM on December 26, 1996, after its vigilance arm suggested that action be taken against the company. It, however, retracted its decision early in January. The letter had said: It has been decided by DoT to blacklist and ban business activities with M/s ARM, Hyderabad with immediate effect. The withdrawal of the December 26 order was done on December 31 in a department letter. The material management group of DoT which handles the case issued a letter saying the letter (of December 26) in original may be kindly returned and no further action be taken.

DoT officials said the decision to revoke the ban on ARM was taken for two reasons. One, the alleged wrongdoing by ARM has not been proven in a court of law. And, two, the department rules an elaborate procedure to be followed before blacklisting a company.