The Hindu : Tata-VSNL investment decision: DCA seeks report

Online edition of India's National Newspaper
Saturday, Jul 06, 2002

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Tata-VSNL investment decision: DCA seeks report

NEW DELHI JULY 5. The Department of Company Affairs has sought a report from the Tata group on the controversial decision to invest Rs. 1,200 crores in its loss making Tata Teleservices from VSNL's reserves.

Oficial sources told PTI that the move came following a complaint registered by the Investors Grievances Forum on the alleged "siphoning off'' of funds by the Tata group which had bought 25 per cent stake of VSNL with management control for Rs. 1,429 crores.

It is understood that the department had called for the report at least two weeks ago from the Videsh Sanchar Nigam Limited (VSNL).

The department would be able to firm up a view on the compliant only after getting the report from VSNL, the sources said.

Sources, however, said there would not be any hasty action by the department and it was still examining the merit of the complaint made by IGF as it did not want to rake up fresh controversies.

They said the department had always taken proactive steps for expediting disinvestment through which the Government has targeted Rs 12,000 crores this fiscal.

Earlier the BJP MP and the forum's President, Kirit Somaiya, met the DCA Secretary, V. K. Dhall, and asked for stern action against the Tata group.

The forum had alleged that the decision to invest in Tata Teleservices was tantamount to violation of certain sections of the Companies Act and the Company Law Board.

— PTI

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