Date:20/02/2004 URL: http://www.thehindu.com/2004/02/20/stories/2004022003581200.htm

National

CPI(M) demands CBI probe into hotel sale

By Our Special Correspondent

NEW DELHI, FEB. 19. The Communist Party of India (Marxist) today demanded a Central Bureau of Investigation probe into the sale of the Centaur Hotel in Mumbai following the Comptroller and Auditor-General of India report of a Rs.145.69-crore revenue loss in the deal.

The party said the latest CAG report disclosed the loss in revenue on account of under-charging of lease rent and deduction of turnover levy while selling the Government-owned property to Batra Hospitality Private Limited.

The latter had resold the hotel after six months at a premium by reportedly selling it for Rs. 115 crores after having purchased it for Rs. 83 crores.

The CPI (M) Politburo member, Sitaram Yechury, and Rajya Sabha leader, Nilotpal Basu, said that when the issue was raised in the House, the Disinvestment Minister, Arun Shourie, had dismissed the charges as fabricated and did not respond to the specific charges of lapses by the Government in the deal favouring an individual.

"Over and above the moral issue of such a sweet-heart deal, it was selling prime asset to someone close to the Government who, in turn, made profit," Mr. Yechury said at a press conference here. The party questioned the valuation process through which the Government lost revenue.

The two leaders said that subsequently, the Parliamentary Standing Committee on Transport, Tourism and Culture took up the issue and in the last report, recommended an inquiry by the Central Vigilance Commission on the selection criteria, reduction of the turnover levy, the re-bidding process and the transfer of an Indian Oil Corporation petrol pump in the hotel to the BHPL without the knowledge of the IOC.

The party alleged that the Government did not take any action on the recommendations and during the debate in Parliament, it was highlighted how a "public asset was sold at a throwaway price to help a single bidder."

"There was no open bid even when the tender condition was changed through reduction of turnover levy. The CAG report has now confirmed that a revenue of Rs. 145.69 crores to the public exchequer had been squandered for a deal of Rs. 83 crores. In the process, Mr. Batra coolly got away with a premium of Rs. 32 crores within six months through resale," the party alleged.

It said the party would put pressure through a public campaign and the Members of Parliament would write to the President on the issue