City man booked in Rs 487 crore coal import scam

Along with officials of National Thermal Power Corporation (NTPC), Aravali Power Company Pvt Ltd (APCPL) and Metals and Minerals Trading Corporation (MMTC), in connection with an estimated loss of Rs 487 crore to government in coal import in the years  between 2011 and 2015, by fraudulent method.

In its First Information Report (FIR), CBI  had named AR Buhari, promoter of Coastal Energy Pvt Ltd (CEPL), Chennai, as the prime accused in the case, along with unnamed officials of NTPC, MMTC and APCPL. 

CEPL successfully bid for the contract for supply of coal to NTPC and APCPL, a joint venture company of NTPC, Haryana government and Delhi government. According to the FIR filed by CBI, CEPL had been sourcing low-grade coal through its own sister concern suppliers from Indonesia. 

The sister concerns would sell the same coal as high-grade substance, using inflated invoices, after manipulating quality test reports to CEPL or to MMTC via CEPL. Post-import, the said consignment of inferior quality coal was supplied to NTPC and APCPL as higher-grade coal at a higher price, noted the FIR. 

Although the importers are allowed to seek concession if they import from Indonesia, the importers in this case did not bother to seek the custom duty exemption, concealing the fact that the coal was being procured from the particular country. 

CBI is of the opinion that all the related officers in NTPC, APCPL and MMTC were aware of the scam being committed by the importer. CBI also points out that the Directorate of Revenue intelligence (DRI), had investigated the over-valuation in the import of coal by CEPL among other companies and issued notice to the Chennai firm.  

During DRI investigation it was found that over-invoicing of more than Rs 363 crore was done on coal imported by MMTC, using the above mentioned modus operandi. Similarly, over- invoicing of Rs 124 crore was done by CEPL, amounting to Rs 487 crore loss to the government.