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UK firm gets contract; India gets bad deal
Sumon K Chakrabarti , CNN-IBN
Posted on Sep 21, 2009 at 21:29 | Updated Sep 21, 2009 at 22:02

New Delhi: The Petroleum Ministry wrongly favoured a company in the United Kingdom for supplying fuel markers that were to be used by Indian authorities in detecting fuel adulteration, a CNN-IBN investigation has found.
The Ministry in October 2006 started a project to dye kerosene with a non-removable marker to detect adulteration of automobile fuel. The marker was supplied by the Authentix company, which claims to be a global leader in authentication, at an annual cost of Rs 200 crore.
Within 15 months the project was scrapped and the Central Vigilance Commission (CVC) allegedly found irregularities in the deal with Authentix.
The Central Bureau of Investigation (CBI) last month received a CVC report which points to a high-level scam within the Petroleum Ministry. The report alleges the Authentix marker was selected though tests had revealed that the company’s marker could be tampered with.
The CVC report alleges Authentix was selected for the project arbitrarily and by disregarding norms for issuing contracts. A tender was issued on 28th April 2004 but 20 days before that, on 8th April 2004, three companies were already rejected because their marker was allegedly not tamper-proof.
Authentix was allowed to increase its rates by 55 percent and it was selected for the project--international competitive prices were allegedly never checked.
The cost of the earlier fuel marker was Rs 2,550 per litre, but Authentix sold its product for Rs 13,219 per litre.
The CVC have found that Authentix earlier operated under the name Biocode, which the Petroleum Ministry had rejected because its product failed to meet standard requirements.
The CVC has found that it was decided that the Authentix marker was to be first tried out in New Delhi, but the then Petroleum Secretary M Srinivasan allegedly gave abrupt and oral orders that it would be used across India. The order was allegedly given though marker had failed in the trial stage.
Srinivasan and R S Pandey, who is the current Petroleum Secretary, refused to comment on the allegations against the Ministry. CNN-IBN has learnt that the CBI is planning to question senior Ministry officials about the deal with Authentix.

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