Blacklisted Videocon appeals to WB to revoke ban

Company appealed against the ban to the bank in February, reveals chairman Dhoot

PTI | May 5, 2010


File photo of Videocon chaiman Venugopal Dhoot
File photo of Videocon chaiman Venugopal Dhoot

Blacklisted by the World Bank for alleged corruption and wrong doing, Videocon Industries on Tuesday night said that it has moved a petition to revoke the ban.

"We approached the World Bank in February, 2010, to revoke the ban ... after some hearings, we hope it will be done," Videocon chairman Venugopal Dhoot told PTI, shortly after the global lender's decision became public.

Dhoot said that the action came on account of some wrong information given by one of its employees in a tender in 2003 for supplying airconditioners worth about USD 50,000.

"We suspended that employee and took disciplinary action. We have so far not supplied anything to the World Bank," he said, adding that given the size of the group this was not a very significant order and his firms would not do anything wrong for securing any supply order.

After the tender documents were filed, the World Bank found the wrong information and they debarred the firm, he said.

In its notification, World Bank said Videocon Industries Ltd has been barred from doing any business with it for violating "procurement guidelines", for a period of three years, beginning January 11, 2010.

It further said that the ineligibility might be reduced by up to one year, if after two years of ineligibility, the Bank's Sanctions Board finds Videocon of having taken "satisfactory" remedial actions.

Earlier report:

Videocon dealings tainted, no business with it for 3 years: World Bank

Bank accuses company of indulging in fraud and corrupt practices, blacklists it till January 2013

Accusing Venugopal Dhoot-led Videocon of indulging in fraud and corrupt practices in dealings with it, the World Bank has blacklisted the Indian company for three years, ending January 11, 2013.

Videocon Industries Ltd has been barred from doing any business with World Bank for violating "procurement guidelines", for a period of three years, beginning January 11, 2010, a notification on the Bank's website said.

The World Bank had taken a similar tough line with Satyam Computer months before the IT company's founder chairman confessed to an accounting fraud.

Neither Dhoot nor his spokesperson could be reached for comments, despite several phone calls and messages.

Videocon was sent a "letter of reprimand subsequent to an administrative process" permitting the company to respond to the allegations, the World Bank said in its latest update of companies blacklisted for doing business due to fraud and corruption charges.

Videocon's name has been listed among firms and individuals ineligible to be awarded a World Bank-financed contract, as it has violated fraud and corruption provisions of the procurement guidelines.

The Videocon group is a conglomerate with interests in consumer electronics, home appliances, oil & gas, telecom & media, among others.

The list of debarred entities from India include two Kolkata-based firms B R & Sons and Hemant Tibrewal, and three Delhi-based entities -- Om Prakash Jindal, Upasana Jindal and S M Scientific Instruments Pvt Ltd.

These five entities were debarred by the World Bank in January this year and the sanctions would be in place for three years till January 2013.

Other Indian entities in the list include Nestor Pharmaceuticals, GAP International and Surendra Singh. While Nestor has been banned from July 2007 till July 2010, the two others have been debarred permanently.

In January 2009, World Bank disclosed that it had banned three Indian firms -- Satyam Computer Services, Wipro Technologies and Megasoft Consultants -- from receiving direct contracts from the Bank group under its corporate procurement programme.

"The World Bank Group has decided to make public the names of all companies that have been debarred from receiving direct contracts from the Bank Group under its corporate procurement programme. This change was made in the interest of fairness and transparency," World Bank had said in a statement in January last year.

Satyam was debarred for a period of eight years starting September 2008 while Wipro was banned for four years starting June 2007. The World Bank debarred MegaSoft for four years, beginning December 2007.

"The period of ineligibility of Videocon Industries Ltd extends to any firm directly or indirectly controlled by the sanctioned firm," World Bank said.

It further said that the ineligibility might be reduced by up to one year, if after two years of ineligibility, the Bank's Sanctions Board finds Videocon of having taken "satisfactory" remedial actions. .
 

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