It is no secret that the Meghalaya Transport Corporation (MTC) is bankrupt and struggling to pay its employees. But this has not stopped company bosses from continuing to dole out largesse running into lakhs of rupees from its scarce resources to a private entity, First Choice Autokraft (FCA), which runs a workshop in Sawlad, here in the city, on the premises of the MTC’s central workshop.
According to sources in the state-owned MTC, FCA owes more than Rs 20 lakh in rent and Rs 31 lakh in unpaid electricity bills that have accumulated since 2016. The private company was also the beneficiary of renovations to the MTC workshop property that cost Rs 30.42 lakh.
Questions have been raised as to how a government company could formulate a deal with a private party without floating a tender. The agreement in question was signed on April 1, 2016 between the MTC and the FCA’s proprietor, Kiran Devi Lohia.
FCA originally agreed to rent 436 square metres on the workshop premises for a monthly rent of Rs 40,000. To cover this was a fixed deposit of Rs 15 lakh for a period of 10 years. A further, undated, agreement was again signed by which FCA was granted another 450 sq m for an additional Rs 27,000 per month, taking its monthly rent to Rs 67,000.
According to sources, however, FCA has not paid any rent since April 2016, even though the agreement does contain penalty clauses for non-payment of the agreed sums. Official sources have revealed that at last count, which happened to be in March 2019, FCA owed the MTC more than Rs 20 lakh in rent.
As far as power bills go, the tenancy agreement stipulates that FCA should have its own separate electricity connection and meter. Inexplicably, however, the meter which was to be installed for that purpose did not work and MTC has continued to foot the bill in full even though it no longer has any equipment that draws heavily on electricity on the premises.
The MTC’s generous treatment towards the private firm also extended to the renovations, which were done to suit FCA. This reportedly went against the tenancy contract but when a new MTC Managing Director tried to fix responsibility on the officials who had approved the payment of lakhs of rupees for the renovations, which should have been paid for by FCA, he was unceremoniously shunted out of his seat by the powers that be. Before he was removed from his position he had also demanded that FCA close down its workshop unless it paid its dues but the company petitioned the court, which stayed proceedings.
A former MD also fought hard to rectify these issues but saw his efforts stymied by powerful figures in the company and government.
This farce is known as the controversial “Lohia case” in MTC corridors.
“Based on the court stay order, they (FCA) are still running their workshop without paying rent or paying the electricity bills till date,” said a source. “We don’t even know why the MTC is still paying their electricity bills, which are actually paid by the state government,” said another.
Although the contract has a penalty clause for non-payment of rent, there is, shockingly, no termination clause in case the tenant defaults.
How this serious loss to the State is to be addressed by the present government remains to be seen but restless MTC workers, who are witness to the corruption in their midst, are distraught that a once shining company has descended into sickness and bankruptcy.