Fitting reply to Vectra on Tatra deal

Vectra Group, via its recent press release, has refuted allegations of wrongdoing leveled against its owner Ravi Rishi and Tatra Sipox (UK).

Click here to read the group’s press release…

Arun Agrawal, author of the book ‘Reliance: The Real Natwar’ and a prolific writer on issues of public interest, has rubbished the facts claimed by Vectra. In a point-by point-rebuttal, Agrawal states that the real facts about the Tatra deal are far worse.

Below is his reply to the press release of the company.

Dear Mr Nair and Mr Diliep Singhji,

Kindly refer to the allegation versus facts issued by you on behalf of the company Vectra and its ultimate owner Ravinder Rishi.

You are right, though unwittingly: The real facts are far worse than what you have stated in your allegation column.

You have deliberately understated the allegations! More so on the figure of the loot. Who said that you looted only Rs 750 crores. The figure is Rs 4,000 crores.

Your explanations to the allegations described as facts are lies and they are not even clever lies. Your boss Ravinder Rishi along with your Indian cohorts, including the Moradabad exporter’s group, make the mistake of thinking that all the people can be fooled all the time. And that everyone is for sale.

Mr Nair, let me enlighten you that in the 2G scam, though Anil Ambani did not go to jail, his three senior employees did. You would do well not to speak out of turn and create a smokescreen lest you suffer a similar fate and are made the fall guy by your boss and the CBI.

Having exchanged pleasantries let us address the allegations seriatum:

Allegation: Tatra Sipox is a trading company and not the original manufacturer of Tatra trucks. Thereby the deal with BEML violates Indian procurement rules.

Response: The truth is worse than the allegation. The fact is that Tatra Sipox is not even a trading company. Why don’t you produce the balance sheet and the profit and loss account of Tatra Sipox from 1997 onwards? Reveal the payments that were made to Tatra Sipox by BEML through irrevocable non-transferable Letter of Credit through SBI’s London Branch.

• Tell us why the payments made by BEML to Tatra Sipox are not reflected in the books of Tatra Sipox?

• Why does Tatra Sipox submit abbreviated accounts which do not require audit?

• To whom were the payments made by BEML assigned to?

• To which company in the tax haven of Liechtenstein?

• Have you heard of Deswa Holding Establishment?

• In whose pocket did the profits evaporate?

• In which country did you declare the ill-gotten loot as profits and pay taxes on the loot? Or did not show the profits because bribes had to paid from the loot?

The company Tatra Sipox is registered for carrying on spiritual, religious and social purpose, including marriage and dating services. Was it because corruption and bribing too are related to making proper alliances with the right people?

As for your explanation of the company being promoted by a Slovakian, why did you not name him? Is he not one Jozef Majky? Was he not jailed for 22 months for defrauding people in Slovakia, like your owner Ravi Rishi who defrauded people in  Czech Republic, Britain and India.

You have stated that both OEMs (original equipment manufacturer) appointed or were part of Tatra Sipox (UK). Produce the documents.

• Was Tatra Sipox a subsidiary of either of the companies or were the expenses of marketing of Tatra Sipox paid by either or both the companies?

• Did Tatra Sipox work on a fixed commission from Tatra A.S. as other car/truck dealers do?

• Is it not a fact that Tatra Sipox deliberately misused the name Tatra and took orders as a self-appointed middleman.

As for Tata Sipox which supplies technical support, provides transfer of technology to BEML and develops new products on behalf of both factories, name the engineers on the pay roll of Tatra Sipox, their qualification and the type of innovative technology supplied in the last 13 years to either BEML or Tatra a.s. What patents have you filed for?

The fact is Ravi Rishi does not have any know-how but only has know who; through bribes and kickbacks. Photographs in The Pioneer are not his only connections. Other photographs with the famous Moradabad exporters are also doing the rounds.

Your assertion that there is no violation of the defense procurement rules as “firstly, Tatra Sipox (UK) sold to BEML and not directly to the MoD and secondly is an authorized vendor”, admits to the fact that you were a middleman to BEML but not to MoD.

The argument that Tatra Sipox can be a middleman to BEML and the policy of no middle man was only applicable to MoD is hog wash.

First, to make the argument you concede that you were a middleman. Second, BEML is a government company to which Article 12 applies and is treated as a STATE. BEML too cannot entertain middleman. It too has to deal with principle to principle. (P-P and not P-M where M is for middleman)

Is it not a fact that Rishi had VRS Natrajan appointed to the post of CMD of BEML by paying hefty bribes (with a tenure of over ten years) and immediately thereafter renegotiated the deal/MoU which was not due for renewal to exclude strategic parts like the gear box, axles from indigenization?

Is it not a fact that in the original agreement with OmniPol  a sum of three crore was paid by India for complete transfer of technology? Just as BEML paid for technology transfer in the case of Bofors. For your benefit, here is the abbreviated accounts of Tatra Sipox filed with UK authorities which substantiates the facts mentioned above.

Capital of 15,000 pounds and total shareholder funds of 2.5 lakh pounds (Rupees Rs 2 crore) in thirteen years of loot.

Allegation: Tatra trucks were sold three times its original price of Rs 40 lakhs, which led to an estimated loss of Rs 750 crore to the exchequer.

Fact according to the representative of Rishi to refute the allegation: TS (UK) sold to BEML. The price between BEML (a defence PSU) and the MoD is not controlled by Tatra. Additionally, at no time full trucks were sold to BEML. The parts and components sold to BEML were as per normal company prices.

Response: While one appreciates your smartness in underplaying the allegation of your boss being just a a petty crook for an amount  Rs 750 crores, the fact is that he stole Rs  4000 crores from the poor people of the country. This is how and why:

• For a CKD  of a 6X6 truck, BEML paid Rs 85 lakhs to you, another Rs 10 lakhs for spares and kit. BEML fabricated the body etc for Rs 10 to 15 lakhs and sold it to the MoD/Army for Rs 1.30 crore. Rishi milked the poor country for Rs 50 lacs per truck. Multiply it with 7000 plus trucks, spares and kits over the years and the figure would be a neat Rs 4000 crores.

Instead of being clever why don’t you reveal  the sale price  received per CKD kit  from BEML and the purchase price paid by you to Tatra a.s. of Czech republic and clear your name? Do not insult the intelligence of crores of Indians who have been to school and were taught: Profit = (Sale Price – Cost Price) X Quantity.

Your arguments implying that it was BEML that was profiteering and raking in the moolah may be bought by some of India’s seasoned journalists because they do not know or know too well, but will not cut ice with a 15-year-old kid who has been to school and done the above sums.

I would request you to make public the above figures to prove that there has been no wrongdoing on your part. You will not do it because you have not only cheated the Indians, but also the Czechs and the British by not accounting for the turnover and paying taxes on it.

Allegation: Lt Gen Tejinder Singh was lobbying for Tatra trucks and offered bribe to COAS.

Fact according to your press release: No member of Vectra has ever met this individual and he has never worked with Tatra nor been given any mandate on behalf of Tatra.

Response: Are such mandates ever given in writing or contract signed? If you go across the length and breadth of the country where bribes are paid for anything or everything, you will find touts who orally assure you that your work will be done for a bribe to the government official and a commission to him (the tout). You pay him after the work is done.

• How was this case any different except that to gain access to a COAS you needed a retired Lt General? Where is the question of giving a mandate?

• Why doesn’t the Lt General disclose the pretext he used to approach the COAS and why the recommendation of his post-retirement post did not fructify or why he was never given a second appointment by the COAS?

The fact is that you have been paying off the dishonest officers in the army to get your work done but this time the file was struck with the COAS who happened to be a honest man. That the COAS reported the matter to the Minister, a fact acknowledged by the Minister, and that he and the Minister ensured that your loot comes to an end is sufficient proof on the contentious matter.

Incidentally Brigadier Inder Mohan Singh, a whistleblower, who raised his voice against this shady deal was mysteriously transferred.

Here is an excerpt from the story published by Firstpost:

And according to an Army whistle blower, Brigadier (Retd) Inder Mohan Singh, asking questions with regards to the BEML – Sipox deal was a big no-no.

The Brigadier said that he wrote in to ask for details of the price of the trucks, and for copies of the transfer of technology agreement in 2003. The very next day, he had a surprise visitor waiting in his office.

“At 9 o clock, when my office had barely opened, a BEML officer was sitting in my office,” Brig IM Singh told CNN-IBN. “He said, ‘Sir, marwadiya sabko’ (You’ve killed everyone).”

Asked what he meant, the visitor confided: ‘The letter you faxed yesterday will create a lot of trouble.”

If anything, it was Brig IM Singh who found himself in trouble. His letter, making enquiries about the deal, was cancelled, and he was transferred out of the Equipment Branch.

And an excerpt from the story published in Outlook Magazine:

Brig I.M. Singh tells Outlook how he was hounded out of the Master General Ordnance branch for initiating inquires into BEMLs functioning.

I was posted to MGOs branch in April 2003 and my portfolio included management of in-service equipment relating to vehicles, including the Tatras. As part of this I visited the BEML sometime in mid-’03. What I saw was that BEML is only a conduit, getting semi-knocked down vehicles which after some fitting of nuts and bolts were supplied to the army. This job could be done at our base workshops servicing the Tatras.

I am sure the job of getting Brigadier Singh transferred was done through a serviceman without any mandate. Do not give lessons to the country on the fundamentals of bribing. Everyone knows how the system works.

Allegation: Despite being sold to the Indian Army for long, the trucks were not indigenized enough (Tatra vehicles are still left-hand drive).

Facts according to your press release:Actually 60% of the truck is now indigenized.  Furthermore the 4×4 and 6×6 are RIGHT HAND DRIVE. The 10×10 and 12×12 were specifically designed for India’s missile program by Tatra. Members of Tatra Sipox (UK), Tatra and the DRDO were involved over several months to create this unique engineering product – the first of its kind in the world for on road/off road application. The 8×8 truck was never made a right hand drive; because of the small irregular demand cycle by Indian Armed Forces would not have justified the heavy investment needed to change the technical dynamics of the truck.

Response: When did the trucks become right hand drive? For how long were they left hand drive? How many trucks are left hand drive and how many right hand drive? No country with traffic keeping to the left will accept left hand trucks for its army. You sold left hand drive trucks and imperiled the life of the army truck drivers.

Remember, army truck drivers may not be very educated but have great common sense. One of them is called Anna Hazare, who was a truck driver in the army and drove right hand drive trucks during his time. Let him not know your story. Otherwise he will sit on a fast and get you all behind bars for having betrayed the Indian Army.

As for indigenization, reveal the proportion in terms of money and not in terms of components, where an axle is one component and so is a nut a component. The break up given above shows that Rs 90 lakhs is paid per truck to you.

The remaining two points raised in your press release are not worthy of response.

Regards,

Arun Agrawal

(Arun Agrawal is the author of the book Reliance: The Real Natwar. The opinions expressed by the author and those providing comments are theirs alone, and do not reflect the opinions of Canary Trap or any employee thereof)