Navbharat Power directors grilled

The company was sold to Essar power in 2010 after two coal blocks —Rampia and dipside Rampia — were allocated to it for a power plant in Orissa. The agency on September 4 had filed an FIR against the Hyderabad-based firm and its directors for misrepresenting facts and fudging books to get a coal block allocated.

The directors of the company — Trivikram Prasad and Hari Prasad — were questioned by the agency in connection with the scam. The duo was also grilled over the irregular manner in which the firms shares were transferred to Essar power.

In its FIR against the company, the CBI said Navbharat sold its majority stake to Essar Power in July 2010 giving 5,000 personal shares of the promoter for R50 crore and another R85 crore worth of company's shares for a much lower value of R12 crore. "The promoters of Navbharat Power sold their personal shares to Essar at highly inflated prices, whereas the company shares were sold for a pittance," a source said.

The company's net worth wasn't sufficient to get a coal block but it added a bank letter which said the bank was ready to loan their project, a CBI officer said.

According to CBI officials, in order to meet the eligibility criteria for getting a captive coal block, the Prasad brothers floated Navbharat Power. It was allocated two coal blocks in Orissa for which 108 applications were received but only two companies were invited by the screening panel.

The final allotments went to six companies. Navbharat Power was among the firms that included Reliance Energy, Sterlite Energy, GMR Energy and Mittal Steel.

The founders of Navbharat held 66.7% of the firm's shareholding in 2008. By March 2009, their share reduced to 0.05% and in 2010, the company was acquired by Essar.

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