M A I N   N E W S

Tatra truck deal
Day after VK Singh retires, BEML sends him legal notice
Shubhadeep Choudhury/TNS

Gen’s allegations Tatra trucks supplied to the Army by BEML were substandard and overpriced The trucks were being sold in Czechoslovakia for Rs 28 lakh each while in India they cost three times more Spare parts of Tatra trucks were supplied to the Army by BEML at a hugely inflated rate

Bangalore, June 1
Less than a day after Gen VK Singh retired as the Army Chief, the public sector Bharat Earth Movers Limited (BEML) today slapped a legal notice on him, demanding an apology for his “false and motivated” allegations against it in the Tatra trucks case.

“Legal notice has been issued today. If he does not apologise, we may file a defamation suit against Gen VK Singh,” BEML chairman and managing director VRS Natarajan, who was at the receiving end of retired Gen’s charges. It was alleged that Tatra trucks supplied to the Army by the BEML were substandard, overpriced and difficult to service.

“I completely deny the charges levelled against us by Gen VK Singh. These are false,” Natarajan said.

Gen Singh had also alleged that a former Army officer had offered him Rs 14-crore bribe to clear supply of a tranche of 600 Tatra trucks. The CBI is carrying out investigations in the case.

Asked whether he had taken the Defence Ministry’s permission before sending legal notice to the former Chief of Army Staff, Natarajan said it was within his power as the CMD to take a decision on suing someone for defamation.

On why he did not send legal notice to VK Singh earlier and waited for his retirement, Natarajan said the groundwork took some time and the notice had to be vetted by legal experts.

Three TV interviews given by VK Singh had formed the basis of the defamation notice, Natarajan said.

Rebutting the former Army Chief’s charge that Tatra trucks were being sold in Czechoslovakia for Rs 28 lakh per truck and in India it was being sold more than three times that price, Natarajan said 567 Tatra trucks of various models were purchased by the Czech army at a cost of $ 130 million in 1997. “This shows that the price of an individual truck purchased by the Czech army was around Rs 78 lakh. It is near about the same price the BEML had charged the Indian Army per truck,” he said.

On the charge that spare parts of Tatra trucks were supplied to the Army by BEML at a hugely inflated rate, Natarajan said: “A total of 133 spare parts were supplied by the BEML to Army over a period of six years from 2004 onwards and the total amount billed was Rs 10 crore. BEML earned about 16 per cent in excess of the cost of the spares from these supplies.”

Natarajan said he never received any complaint from the Army regarding the trucks. He added that 62 per cent of Tatra trucks had been ‘indigenised’. On why the truck components were purchased by BEML through a third party and not from the OEM (original equipment manufacturer), Natarajan said right from the inception Tatra trucks were purchased through some agent. At first it was Omnipol, a trading agency, through which the trucks were purchased, he said.

The Tatra Sipox UK, the agent through which BEML has been sourcing Tatra truck components lately, came into picture after the break up of Czechoslovakia into Czech Republic and Slovakia, Natarajan said. The arrangement with Tatra Sipox UK was finalised before I took over as the CMD, he added.