COMMENTARY
INTERVIEWS
SPECIALS
CHAT
ARCHIVES

Raasi's new brass 'unearths' free mines transfer to Sri Vishnu

The former B V Raju-controlled management of Raasi Cement allegedly transferred over 100 acres of company-owned mines to the Sri Vishnu Cement Limited in November 1997 without any monetary considerations after the Raasi board had decided to divest its holding in Sri Vishnu, the new Raasi management sources alleged.

The Raasi board had, on September 20, 1997, decided to divest 50 per cent of its holding in Sri Vishnu Cement. At a later board meeting, it decided to sell the rest of its shares in Sri Vishnu, a company it had promoted, nurtured and rehabilitated.

On November 15, Raasi Cement proceeded to transfer over 100 acres of a mining lease owned by Raasi Cement to Sri Vishnu Cement without any consideration, the spokesperson said.

Among many irregularities detected by the new Raasi management after it took control over the company, the spokesperson said that the B V Raju-controlled management diverted over Rs 300 million of Raasi funds to various entities controlled by himself and other original promoters. The new management, which took over charge in June 1998, has recovered about Rs 85 million of the diverted funds after it initiated recovery proceedings.

The annual report for 1997-98 of Raasi Cement also referred to the controversial sale of 39.5 per cent stake in Sri Vishnu Cement held by Raasi to nine companies at Rs 10 per share.

Although the transfer was effected in December 1997 and money paid until March 1998, Raasi Cement obtained approval of the Industrial Development Bank of India only after the close of the financial year, the annual report said.

The previous Raasi management sold goods below cost of production, the report said. It sold clinker to Maatha Cement and Viswam Cement at prices below the variable cost of production, it said. The auditors have qualified the report with these observations.

UNI