Tamil Nadu | Probe launched into coal import scam involving Adani group

Tamil Nadu government approves investigation into coal import scam involving Adani group, DVAC registers preliminary inquiry based on allegations.

The Tamil Nadu government has given its nod for an investigation into the multicrore coal import scam involving the Adani group and others. The Directorate of Vigilance and Anti-Corruption (DVAC) has registered a preliminary inquiry into allegations of serious irregularities in the tender conditions and import of coal that caused a huge loss to the State government.

“We have received clearance from the government to register a preliminary inquiry and investigate allegations in the import of coal by the Tamil Nadu Generation and Distribution Corporation (Tangedco). The sanction under the provisions of Section 17A of the Prevention of Corruption Act, 1988, was accorded based on a complaint lodged by Arappor Iyakkam, a private body,” a senior DVAC officer told The Hindu on Tuesday.

The allegation of Arappor Iyakkam, a city-based organisation that works towards transparency and accountability in governance, is that there was massive corruption in the import of coal involving Tangedco officials, Adani Global Pte Ltd. and others to the tune of ₹6,066 crore between 2012-2016. Despite complaints lodged with specific evidence in 2018 and 2019, no case was registered by the DVAC.

On January 31, 2023, Arappor Iyakkam convener Jayaram Venkatesan wrote to Chief Minister M.K. Stalin that no step was taken to investigate the coal import scam which led to Tangedco incurring huge losses and debt. “Even after one-and-a-half years of assuming office, your government has so far not taken any steps to investigate the massive coal import scam of the previous government to the tune of ₹6,066 crore of which around ₹3,000 crore of corruption was done by Adani Global Pte Limited alone,” he alleged.

CAG findings

Mr. Venkatesan said he had furnished evidence in his earlier complaints as to how the tender conditions were changed after 2011 in order to favour Adani Global Pte Ltd. and a small coterie of firms importing coal. Even the CAG found that the turnover requirement for tender value of ₹100 crore was increased to almost ₹1,000 crore to favour a few firms.

He alleged that Adani Global Pte Ltd. and a few others were given tenders at least $15 to $20 more than the market rate per metric ton. The proof of market price published by the Indonesian government then was evidence to prove the allegation. The poor quality of coal imported also resulted in inefficient thermal power generation leading more losses.