Chennai: Rs 437 crore scam alleged in corpn project – Times of India

Chennai News

CHENNAI: There has been a Rs 437 crore scam in the 2015 project involving the construction of 400 stainless steel bus shelters in Chennai city, with money-laundering and favouritism causing the civic body a loss of Rs 288 crore, Arappor Iyakkam, an anti-corruption NGO, said on Saturday, charging that this was linked to former municipal administration minister S P Velumani’s associates.
The NGO, in its complaint to the Directorate of Vigilance and Anti-Corruption said Finearts Communicators India Private Limited, Shine Outdoor and Skyrams Outdoor Advertising were the only bidders for the project. Created in just 13 days, about six months before the tendering began in August 2015, they had neither technical nor financial qualifications, it said.
The firms formed a consortium with smaller companies to show eligibility on paper but the other companies were not seen once the tenders were finalised, the NGO said.
The firms initially quoted an annual concession of Rs 18,000 per bus stop for 15 years during the first tender period (2015-30). The concession was meagre as it takes about Rs 10 lakh to construct a bus stop that can generate revenue of Rs 18 lakh a year.
In the retender, the firms raised the concession to Rs 1,80,000, a 10-fold increase from the first tender. At this rate, the firms would pay Rs 3,11,200 per shelter, with concession to the corporation increasing by 5%. The 400 shelters would cost Rs 48 crore, at Rs 12 lakh a shelter by government price, but the profit generated would be Rs 437.28 crore, leading to unjust enrichment of the three firms, the NGO said.
The NGO said a check found that the director and shareholder of Skyrams and Shine is the brother of R Chandrasekhar, publisher of Namadu Amma and a close aide of Velumani.
There are more than 600 bus shelters built by the corporation and tenders floated for those to be directly maintained by the civic body were cancelled as it may affect the three firms handling maintenance. This led to a loss of Rs 288 crore to the corporation which would have earned Rs 8 lakh per bus stop.
Arappor convenor Jayaram Venkatesan urged the DVAC to file an FIR against Velumani and his associates, and asked the corporation to cancel the tenders.
Speaking on behalf of ex-minister Velumani, his lawyer I S Inbadurai, told TOI the NGO was acting as a ‘B-team’ of the DMK. “They have always been targeting AIADMK. What have they exposed about DMK? It is a public-private partnership scheme where the bidder is paying a concession to the corporation every year. There is no loss for the corporation,” he said.
While two of the three firms mentioned by the NGO didn’t respond to the email sent by TOI, an executive of Skyrams Outdoor, contacted on the official number mentioned in the website, promised to discuss with her CEO and get back.

Source: https://timesofindia.indiatimes.com/city/chennai/chennai-rs-437-crore-scam-alleged-in-corpn-project/articleshow/90469498.cms