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No corporate impropriety by Sesa Goa, says new SFIO report

Naval Bir Kumar, managing director at IDFC Mutual Fund told NDTV Profit that the UP election results will have short term yet sentimental impact on the market.

Ford at the Delhi Auto Expo in January, 2012
Ford at the Delhi Auto Expo in January, 2012

In a U-turn, the fraud probe agency SFIO in its latest report said that mining major Sesa Goa Ltd (SGL) has not indulged in any corporate impropriety with regard to allegations of over and under invoicing of exports and imports.

"Percentage of commission and rates of invoicing in import of coking coal and export of iron ore for sale of iron ore by SGL were nearly at the same levels according to the prevailing market trend during the period from 2001-02 up to 2006-07," said the second report of the Serious Fraud Investigation Office (SFIO).

In its earlier report last year, the SFIO had found various irregularities and had recommended that prosecution be filed on nine counts against the SGL and its management.

The charges against SGL included excess payment of commission to sale agents, over-invoicing of import of coking coal and under-invoicing of iron ore exports amounting to about Rs 1,000 crore.

Following repeated representations from the company, the SFIO conducted second probe and concluded that had the SGL provided the explanations earlier, the conclusion would have been in their favour of the company.

"Had the management of SGL given explanation in their statements recorded by the SFIO during the investigation which is given now in representation, then the conclusion of SFIO, would have been different and in favour of SGL", said the report which was submitted to the Corporate Affairs Ministry on February 28.

The Ministry, which had earlier order prosecution proceedings against the SGL, will now have to take a call in view of fresh findings of the SFIO.