Lokayukta to probe sale of sugar mills during Maya regime

The Uttar Pradesh Cabinet today ordered an inquiry by the Lokayukta into the sale of 21 sugar mills during the BSP regime. In a report, the Comptroller and Auditor General had alleged several irregularities in the sale of these mills and stated that it caused the exchequer a loss of Rs 1,179 crore. In its election manifesto, the SP had alleged that the mills were sold at throwaway prices to benefit private entrepreneurs, and had promised an inquiry.

The 21 sugar mills include 10 run by the UP State Sugar Corporation Limited and 11 closed mills of UP Rajya Chini Evam Ganna Vikas Nigam Limited. These mills were put on sale through a government order, dated June 4, 2007, during Mayawati's regime. Their sale was completed during the BSP regime between October 2010 and March 2011.

"We have decided to hand over the case to Lokayukta for probing into the sale of sugar mills. Further action will be taken after the inquiry report," Chief Minister Akhilesh Yadav told reporters after the Cabinet meeting.

The sale of sugar mills had created much furore in the state. In its report, the CAG had mentioned undervaluation of land and buildings of the sugar mills by advisers. In the first phase of disinvestment in 2007-08, the evaluator assessed the market prices of the land of 11 mills of UPRCGVNL at Rs 280.62 crore, indicating a decrease in market value of Rs 128.41 crore.

The CAG found that there were discrepancies in the circle rates of the areas in which the mills were located. According to the report, the real worth of the land of six mills at Baitalpur, Barabanki, Bhatni, Chhitauni, Laxmiganj and Ramkola on the basis of circle rates was Rs 355.2 crore and not Rs 198.04 core as given by the evaluators. It said that the prescribed stamp duty was not deposited, the bidders were linked to each other and were aware of the expected price even before the financial bids were opened. The plant and machinery were evaluated at scrap rate.

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