Probe culprit thoroughly: BJP leader moves ED over Amarinder-era PACL sale

Punjab BJP vice-president Dr Subhash Sharma has asked the Enforcement Directorate (ED) to probe the 2020 sale of the state’s stake in Punjab Alkalies and Chemicals Limited (PACL). The deal was made when Capt Amarinder Singh, now a BJP leader, was chief minister.

“On public demand, we want thorough investigation into it. Whosoever is the culprit should be investigated thoroughly,” Sharma told Punjab Standard in an exclusive conversation on Thursday. He did not name Amarinder.

Amarinder quit the Congress in 2021 and later merged his Punjab Lok Congress with the BJP. This year he has said publicly that the BJP does not consult him on Punjab affairs.

PACL’s (traded as Primo Chemicals Ltd on stock exchanges with market cap 556 crores) factory sits on about 88.86 acres at Naya Nangal. The town falls in the Anandpur Sahib Assembly constituency, known as Nangal before delimitation, where Sharma has already launched his campaign for the 2027 polls. He was the BJP’s candidate from the Anandpur Sahib Lok Sabha seat in 2024.

Stake sold for price of a power plant

In a letter dated October 25 to the ED Director in New Delhi, Sharma sought a preliminary examination of the sale of the state’s 33.49% stake in PACL for ₹40.98 crore in September 2020. He asked the agency to decide whether action under the Prevention of Money Laundering Act (PMLA), 2002, or help from other agencies is needed.

A few months before the sale, PACL reportedly bought a 70 MW thermal power plant from Chhattisgarh for about ₹40 crore. That is nearly what the state got for its entire stake. Sharma wants the ED to check the purchase date, the agreement, where the money came from, the liabilities attached, and how the plant was counted when the company was valued.

Land, office, machinery

Besides the Naya Nangal land, PACL held a commercial office in Chandigarh, other land, plant and machinery, and industrial infrastructure. Sharma wants the market value of these assets checked against the sale price.

“The valuation methodology, reserve price, transaction adviser’s report, tender conditions, competing bids and approvals should be verified to examine whether public interest was adequately protected,” he wrote.

Profits and ₹116-crore upgrade

PACL’s 2019-20 annual report reportedly showed about ₹116 crore spent on modernising the plant. The company posted net profits of about ₹55.86 crore in 2018-19 and ₹8.80 crore in 2019-20. Sharma said these figures, and incentives under Punjab’s Industrial and Business Development Policy, 2017, must be checked against audited accounts to see whether the valuation took them into account.

Who bought it

The letter asks the ED to trace the real owners of the original buyers and later shareholders, the source of their funds, and later share transfers. It also asks whether tender rules and approval procedures were followed to ensure “equal treatment of bidders”.

Earlier court case

The matter reached the Punjab and Haryana High Court in Arvind Kumar and Others vs State of Punjab and Others (CRM-M-2568-2023), decided on February 28, 2024. Sharma has suggested the ED study the pleadings and the order.

What he wants the ED to do

– Collect and scrutinise valuation reports, tender papers, bids, approvals and financial statements

– Verify the ownership and fair market value of PACL’s land, buildings and machinery

– Trace related money transactions within its legal powers

Sharma admitted that the figures in his letter come from media reports and need to be checked against original records. “This representation is made without presuming wrongdoing, in public interest,” he wrote.

“Transparency and accountability are a must in big economic decisions involving the government’s stake and public assets,” he said in a statement. He has asked the ED to acknowledge the letter and share details of any action, to the extent the law allows.