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Central public sector undertakings (CPSUs) cannot be "left completely independent in making important decisions involving large-scale investments." The Parliamentary Committee on Public Undertakings made these remarks in its report on unproductive expenditure for the development of a copper ore tailings beneficiation plant related to Hindustan Copper Limited (HCL).
The committee gave Star Trace Private Limited (STPL) of Chennai a Copper Ore Tailings (COT) beneficiation plant, which strongly criticised HCL management for oversights. The parliamentary committee claims that STPL won the ₹280 crore contract to recover gold, silver, and other precious metals from copper mining waste by employing a novel, as-yet-untested method. STPL eventually unable to finish the project.
The tender was awarded basis a pilot project which was also executed by STPL. But despite two extensions and an additional expenditure of ₹2.06 crore, the pilot project failed to meet its objectives even after 33 months of operation and was deemed unviable on commercial and technical grounds by the performance evaluation committee.
“While accepting the audit observation, HCL management, in November 2020, stated that the Company's decision to build a full-scale COT Beneficiation Plant with a capacity of 3.29 million tonnes per annum (MTPA) without adequately operating the pilot plant was not prudent, which resulted in an unproductive expenditure of ₹158.05 crore,” the committee noted.
According to the parliamentary committee, the involvement of high-ranking officials, both serving and retired, has been identified and disciplinary actions with a criminal investigation have been initiated. The Committee also note that some officials are scot-free “due to retirement rules.”
The situation underscores the need for stronger internal controls, transparent investigations, and reforms to ensure accountability even postretirement, the committee noted. It also added that changes in retirement rules, strengthening internal controls, promoting ethical behaviour, and enhancing oversight mechanisms are necessary.
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