FAILURE STORY OF DISINVESTMENT

It is quite worthless to narrate about the policies adopted at various

department of the different organization. In some cases polices
adopted resulted blessing to the nation, state, inhabitant as well as
generals including employees but in some cases result came a curse. It
happens only due to the men behind the matter whether they are
clean or corrupted. In such particular incident one can judge the way of
decision taken and came out result of the decision taken.

All are well aware about the fact regarding Selling and Privatization of
HIRAKUD INDUSTRIAL WORKS LTD., (HIWL) a subsidiary unit of INDUSTRIAL
DEVELOPMENT CORPORATION OF ORISSA LTD., (IDCOL) a Government of
Orissa Undertaking to a Kolkata based private concern M/S. VARSA
FABRICKS PRIVATE LTD (VFPL) and handed over on 10th July-2006 under
Disinvestment Policy

When any decision taken, it must be framed by some Politician, Loren,

Intellectual, top Administrator as well as involvement of many other
aspects because such matters fallen direct impact on Nation, State,
Society including citizen. We can not ignore the Fundamental Rights of
the citizen in a vast democratic country like India.

In the particular case if we will go deeply inside the factors serially, one
can easily judge/find out the ill intension, corruption, self interest and
espionages behind the entire transaction of such selling/privatization
by aforesaid member.

SELLING PROCESS:

1. With the vested interest and espionage intention some corrupted

officials of Industrial Development Corporation of Orissa Ltd.
(IDCOL) prepared some false and vegue reports showing huge loss
of Hirakud Industrial Works ltd.(HIWL) a subsidiary unit of IDCOL
having 2 nos manufacturing units and one erection unit namely
Hirakud Industrial Works for fabrication and manufacture of
transmission line tower and structures, Hira Cable Works for
manufacturing of Power Conductors and Project Wing for erection
of Transmission Lines and Sub-stations. Accordingly Government
of Orissa during tenure of Minister, Industries Sri K.B.SinghDeo
decided to sale/privatize HIWL in disinvestment policy. Tenders
were floated, processed, decisions were taken to hand over HIWL
to a Kolkata based private concern “VARSA FABRICS(P)LTD.” With a
total cost of Rs.5.25 crore.
2. Against such illegal and corruption intention, HIW Labour Union
filed a case at Hon’ble High Court of Orissa to prevent huge Govt.
revenue as well as interest of the employees. Addressing at a
huge gathering at Hirakud, Minister Industries Sri K.B.SinghDeo
assured that “not a single unit from western Orissa will be
disturbed, if the same will be done only for the betterment of the
people/employees to a reputed and renounced firm”. During the
assembly sessions, the topic created a storm in the Hon’ble
house, members feels the uncertainty about the buyers company
and pointed their finger towards the fraud buyer company.
Finally decided for re-tender to select a better firm who can run
the factory smoothly providing protection of the employees. In
the mean time the portfolio of Minister Industries was changed to
Sri Biswa Bhusan Harichandan who was one of the member
strongly supported the matter during the discussion to cancel
the tender on M/S.VARSA FABRICS(P)LTD. Finally re-tender process
was undertaken by IDCOL and abnormally delayed for which the
reason behind the matter is not known to any body. Within the
period the so called corrupted officials provided all the official
secrecy clue to the firm and insisted to file a petition against re-
tender and obtained a stay. After elapse of a long period
decisions were taken by the Minister, Industries to finalize the
matter with the said firm with the same value of HIWL of Rs.5.25
crores. Every one were astonished. The particular member who
objected the firm, how gathered all the faith on the particular
firm and selected the said firm as No.1 buyer company .

3. If the matter related to the transaction for Sale/Privatisation of

HIWL will be deeply studied, a lot of clues will be come to the
light. Wheres the then Minister Industries Sri K.B.Singh Deo
assured at the gathering not to sell industries from western
Orissa to a vegue company keeping special care on into the
safety & interest of the employees as well as mentality of the
people. The matter also vividly discussed in Hon’ble state
assembly with the objections of the Hon’ble members for re-
tender with selection of a reputed firm instead of a
unknown/weak/fraud firm suddenly changed entirely as soon as
change of portfolio of ministry to Sri B.B.Harichandan with a lot
of thanks and full faith upon the same firm M/s. VFPL who
strongly objected the firm during course of discussion in the
Honb’le house. Secondly the then Chairman-cum-Managing
Director of IDCOL Sri G.C.Pati, IAS whose services were already
transferred since long retained in leave, allowed to sign on SPA.
 As soon as signing of SPA on the very next day he left and joined
at his new assignment for which within the disinvestment
process of HIWL he could able to purchase 3 nos valuable plots
with two no decorative Flat within the city of Bhubaneswar along
with a luxurious imported Car. What relation of Sri Arabinda
Acharya, Company Secretary of IDCOL with M/s. VFPL. He has
explained that “ The firm is reputed one, They are having vast
office at Kolkata whereas presently all the letters returned with
remarks “Address is not available”. Ignoring all the official
secrecy provided all the documentary evidence, confidential
records in supporting to the said firm to their representative Mr.
Singh till signing of SPA with his signature as Witness-1 for which
he could able to have a complete Building, One Plot with a Car.
Sri P.L.Mohanta, G.M(P&A) supported with the representative till
smooth execution of SPA and also able to earn huge amount and
signed as 2nd Witness. Sri S.C.Samal, the then Managing Director
of HIWL extended his supporting hand towards M/s. VFPL as per
the direction of CMD. He acted as a bridge between Union leader
and M/s.VFPL for finalization of rate and provide all records of
HIWL related to the above sale/privatize and could able to
increase his secret Bank Account and later on a luxurious Car.
Lastly Sri L.K.Das, General Secretary, HIW Labour Union. It is
worth less to remark about him. After finalization of tender for
above sale/privatization, he has been provided with all liberty to
move else where. As and when required with required amount as
entertainment as if Chief Managing Director of HIWL. He has
been presented with building at Choudwar, a huge plot at
Bhubaneswar (Kalinga Vihar), Bank Balance in the name of
spouses and etc, as presentations for which he is not at all
required any desires till 3rd generations.

He was one and only member in spite of repeated objections by

other leaders of co-unions submitted written “No objection”
consents at Honb’le High Court. Finally on 10.07.2006 along with
his other “Chandi”, “Chamcha” signed on the tripartite
agreement for signing of SPA.
4. After a prolonged hearing hon’ble High Court of Orissa ordered
for Sale/Privatize HIWL subject to abide by 20 points directives.
Accordingly a Tripartite Agreement were signed along with Sales
Purchase Agreement (SPA) and handed over HIWL management
to M/S.VARSA FABRICS(P)LTD. with the chairmanship of Sri Pawan
Kumar Ruia on 10.07.2006.
5. There are sharp vigil of Orissa Govt. at every step to prevent
corruption. But particularly in above sale/privatization how it was
slipped. 2 nos full fazed high capacity running factories, One
 complete equipped Erection unit with 2 nos work shops running
with modern machineries, 16 Km of two way Railway Track, 3
Nos Loco Engine, 400 Acre of land along with 18.00 crore sundry
debtors totaling to the tune of some hundreds of crore sold with
only Rs.5.25 crore. As if there is not a single intellectual in India
to prevent such type of unforeseen happenings.

AFTER SELLING/PRIVATISE

1. From 10.07.2006 the buyer company M/S.VARSA FABRICSS(P)LTD.

Disobeying and throwing the 20 point directives of High Court to
their dustbin ruled as per their suit will. As per directives, IDC has
to review the situation and activities of the buyer company after
every 6(six) months and report compliances to Hon’ble court as
well as Government. But what was happened. It is better known
to the buyer company and IDC. In the mean time out of 24
months guarantee period of the terms & conditions of the SPA,
17 months have already been elapsed to review the situation. If
there is such records are available why IDC is not displaying the
same in public to ascertain the actual position.
a) Stop all the ongoing works, ignore all the balance works
placed on HIWL unless and until realization of entire sundry
debtors on different agencies.
b) Target & responsibilities were fixed upon the employees to
realize the amount otherwise penalized without
considering any difficulties for such realization which are
related with so many factors like approval of quantity,
budgetary approval, reconciliation of materials etc.
c) Collect fresh orders with 80% amount as advance. Till date
crores of rupees collected against supply of materials and
fled from orissa without any supply. As a result of which
the parties are sitting with hand on their fore-head.
d) After taken over as assured by the Chairman Sri Pawan
Kumar Rua of M/s.VFPL(As in VCD) salary/wages are to be
disbursed regularly on every 10th of succeeding month but
practically for the month of July-06 paid on 11.08.06 &
21.08.06. For the month of August-06 paid on 19.09.06. For
September paid Nov-06, for Oct-06 in Dec-06. Gradually
the gap increased and finally as on date back period
undpaid salary/wages reached with 17 months.
e) Without payment of salary/wages as well as any shorts of
payment to the employees created agony, mental worry,
illness, poverty which is the clear indication of killing
fundamental right in democracy “Right to live”. With such
type of torchour, one employee Sri Bhimasen Sahoo lost
mental imbalance, admitted in hospital. In spite of several
 request could not got a single pie for purchase of medicine
and closed his eyes leaving back his grip family. Till date
his widow is begging from Hirakud to Bhubaneswar office
for dues of his deceased husband. The copy of the said
document is enclosed for reference. Further another
employ Sri Bhikari Patra. After several request letter he
could not arranged a single pie to purchase medicine for
his ill ness and at present admitted at hospital, waiting
with eager eye for his dues to meet medical expenses. His
documentary evidence is also enclosed for reference.
Documentary evidence pertaining to suffering, Illness,
Child Death occurred due to negligence in treatment
caused due to poverty are also enclosed herewith for
reference. Over and above parents, dependants of other
employees suffering since long are also deprived of the
medical treatment due to non payment of salary wages to
their son/brother/relatives. The medical documents
pertaining to such cases are also enclosed. The education
facilities to the children of the employees totally disrupted.
The dependant and The employees are freed whether they
are citizen of a largest democratic country “India” or else
where.
f) All the traveling expenses were stopped. Employees have
to meet their traveling expenses from their own pocket. If
disobeyed, action taken. Since date year back passed
traveling bills of employees are pending awaiting release of
amount.
g) Implementation of salary package to the employees is far
and beyond from the expectation, the company is not
allowing annual increments to the employees. Prevailing
Benefits allowed earlier have totally disallowed from
10.07.2006.
h) No imprest money provided for day to day office expenses,
fuel for vehicle even payment to part time sweeper for
cleaning of office/premises. Without payment Telephone,
Electricity and Water line connections were disconnected
by the authorities
i) At present not a single official from company side is
available in Orissa to look after HIWL. From 10.07.2006 till
date 13 nos top officials came and left in relay race basis.
All shorts of communication were disconnected at the
office of the buyer company at Kolkata. Letters addressed
to M/S. VFPL returned with remarks “Address is not
available”. Telephone, Fax as intimated earlier is not
responding. Mobile phones of different officials intimated
 earlier is “switched off”. In such type of situation, to whom
the employee should submit their application/complain ?.
j) It may be mentioned here that, after declaration of “Sick
Industry” to HIWL, it was sold/privatized with certain
directives/terms and conditions, which are to be reviewed
regularly and report compliance. Out of the total directives,
the prime points were, Protection of Employees/Labour
interest, Smooth running of the works, but practically it
was noticed that during the period the buyer company
made Orissa as well as intellectuals of Orissa “Fool”.
Certain examples are noted below which can be explained
every things about their cheatings.

i) RUNNING OF FACTORY/WORKS
As soon as taken over no interest was taken over neither
for obtaining new orders nor taken any action to complete
ongoing orders/works. As the top officials of the buyer
company came and gone in relay race manner, the
purchase could not able to know about the strategy as well
as programme and progress of the orders placed on HIWL.
Hence almost all the orders like 220KV Duburi-aradeep
line, 400KV alance work at Meramundali, 220KV
Narendrapur-Balugao, 33KV Railwa line, 220/33KV
Basundhara Sub-station, 220KV Budipadar-Basundhara
lines were short closed by OPTCL

ii) RECONCILEATION OF MATERIAL & SITE STORE CLOSER

After short closer of the works placed on HIWL, OPTCL
officials time and again repeatedly communicated for
reconciliation of the materials and return of the balance
materials received from OPTCL. In the mean time the buyer
company played a mischievous attitude to cheat Orissa
with OPTCL. One office order issued to each and every site
that “No materials are required to be return to OPTCL and
no officer can sign on any material reconciliation
statement”. They insisted to arrange private parties to sell
all the balance materials at different stores. The stores
were left abandoned. Materials were regularly theft
resulting arrests of the departmental employees at
Gundichapara store for enquire and officer attended or
took any activities for release of the said employees from
local authorities.

iii) REALISATION OF DEBTORS/COLLECTION OF FUND

The main and prime aim of the buyer company is to
speedup realize/collect fund from debtors in top priority
basis ignoring all and entire day to day works. Entire men
and machineries were engaged for the said work. During
the period from 10.07.2006 about Rs._14Crore from
different debtors namely OPTCL, CESCO, NESCO, EMAMI, NALCO,
NINL were collected and deposited in the Bank account of
the buyer company.

iv) ADVANCE FROM PARTIES

The buyer company illustrated them self as a cheater and
fraud. As soon as taken over considering the growing
demand of tower and structural materials in Orissa due to
establishment of number of industries, the employees from
their Kolkata end moved like mad for a few days to collect
orders from different parties for supply of products subject
to deposit of 80%. As HIWL is one and only organization for
manufacture of their required product as well as having
fame in Govt.of Orissa brand, without going in deep they
deposited the required amount with the fraud company
namely M/s. Rawmat, Powercon Project, M Power, AK Das
Associates. After receipt of the amount the fraud company
is sitting at kolkata without supply of a single piece of
material. They are moving in a uncertainly and paying
penalty to their customers. Till date _Crores of rupees as
advance from party have been collected and deposited
with the Bank account of the company.

v) NON DEPOSIT OF GOVT.REVENUE

The Incom Tax deducted from the bills of the sub-
contractor as well as from the salary of the employees has
not yet been deposited with the concerned authorities.
Sales Tax/VAT, Excise Duty, Service Tax etc, also have not
yet been deposited with the concerned authorities.
Whenever the matter was asked, the only explanation is
“Accounts are not yet been finalized”. It is surprised to
mention here that, if the account is not finalized then how
the accounts for the financial year 2005-06 and 2006-07
were audited by a series of auditors including A.G Orissa. It
may be mentioned here that to keep every things in
secrecy, the said fraud buyer company adopted a separate
Accounting package “FACT” by their employees only
confidentially, which facilitate them to use a cheating word
“Accounts has not yet been finalized”.

Vi) LIABILITIES OF EMPLOYEES

 As per the 20 points directives of Hon’ble High Court, it has
been clearly mentioned that, the buyer company has to
clear all the dues along with statutory dues of the
employees including the statutory of retired, VRS,VSS
employees. It is surprised to note that during handing over
of HIWL on 10.07.2006, the unpaid salary/wages of the
employees were for 17 months and as on 25th December-
2007 is also 17 months. The payment made within the
period only meant for the employees/labour worked for the
company only. The statutory due deducted from the
salary/wages of the employees/labour has not yet been
deposited with the concerned authorities. Employees
forcibly directed to move different sundry debtors for
collection have not been paid their traveling expenses. Lot
of T.A Bills are still pending with the said company where
as the company peoples when ever coming on tour are
maintaining luxurious tour. All the benefit/fringe benefits of
the employees were stopped like Conveyance allowance,
Vehicle washing allowance, Incentive Allowance etc. Even
medical reimbursement during accident on duty has not
been reimbursed.

vii) REMITANCE OF IMPREST AMOUNT

During the period to meet day to day office expenses such
as Fuel for the vehicle, Forms and stationeries, Repair &
Maintenance, payment of Electricity, Telephone, Water
charges bill and other small petty expenses etc. necessary
requisitions indicating the details of requirement with
amount were regularly submitted to Kolkata office for
remittance of required amount. WE regret to mentioned
here that, if the requisition will be 100, remittance will be
made 5 resulting disconnection of Electricity line,
Telephone line and Water connection. Due to non-payment
of wages of Part time Sweeper, the Sweeper is not
attending since last May-07. From 10.07.06 till date
thousands of rupees have been remitted as imprest
against which necessary vouchers pertaining to the
expenditures have already been submitted.

ACTION OF EMPLOYEES/LABOUR

Considering aforesaid activities of the Buyer Company as well as IDC of

Orissa Ltd., time and again employees personally applied at different
levels to solve the problems and provide minimum facilities to live. But
it was vain. The Prime Demands includes;
 1. As the buyer company M/S.VARSA FABRICS PRIVATE LTD.,” failed
to abide 20 points directives of Hon’ble High Court as well ad
disobeyed Honb’ble High Court, the Chair person of the
company should be arrested immediately and the Sales
Purchase Agreement (SPA) should be cancelled immediately.
The services of entire employees should be brought back to
IDC of Orissa Ltd.

2. The entire dues of the employees as on date should be

cleared immediately without further delay. The statutory dues
of the employees like EPF, LIC, I.Tax etc should be deposited
with the concern authorities, updated as on date and
necessary slips should be issued to concern employees.

3. The documents pertaining to Sale/Privatization of HIWL should

be handed over to CBI for their enquiry and find out the
culprits having hand for such sale with huge kick-back in a
little amount of only Rs.5.25 Crore for which the total value of
HIWL is more than some hundred crores as stated.

Finally on behalf of the employees/labour (inclusive of executives,

VRS/VSS employees) H.I.W.Workers Union;

a) Applied repeatedly at different levels both Union and

person concerned.
b) Seven (7) notice served addressing to the buyer company,
IDC of Orissa Ltd., Chief Minister, Orissa, Minister,
Industries, Collector, Labour Commissioner/Officer, Local
authorities to stage Non-co-operation, Dharna, Road shows
according to the fundamental rights of the Indian
constituencies.
c) Started agitation from 27.11.2007 in front of the gate of
works simultaneously at Hirakud, Jharsuguda, Rourkela and
Bhubaneswar
d) Union leaders attended and discussed at different levels
both politically and administrators in details about the
situation.
e) All the matters were displayed & published in both
Electronic and Print medias (copy enclosed) repeatedly.

f) Authorities like Labour Officer, Sub-collector, Political

leader, Local representatives visited the agitation site and
ascertained the position. Accordingly instructions were
issued to the concern officials to solve the problems
without further delay.
 g) Decisions were taken to applied at a time with family of the
employee directly to “President of India”, “Chief Justice,
Supreme Court”, “Prim minister”, “Union Minister for
Human Resource”, “General Secretary, International
Amenity”, and “ Secretary General, UN” begging for “Eight
to Live”.
h) This war will continue till end(Full fill of Demand or End of
Life)

Thanking you,

With regards,

EMPLOYEES OF HIW LTD,

HIRAKUD,SAMBALPUR