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Government Calls Off Central Electronics Divestment Process

The Department of Investment and Public Asset Management (DIPAM) said that the winning bidder had not disclosed an ongoing proceeding in National Company Law Appellate Tribunal against itself

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The government of India on Wednesday formally called off the sale of its 100 per cent stake in Central Electronics Limited (CEL) and disqualified Nandal Finance and Leasing, the successful bidder.

The government said the decision to disqualify the bidder was taken following a recommendation by the empowered group of ministers after giving the bidder the opportunity to clarify the disqualification points.

The Department of Investment and Public Asset Management (DIPAM) said that the company had not disclosed an ongoing proceeding in National Company Law Appellate Tribunal against itself.

This led to its disqualification under applicable provisions of the Preliminary Information Memorandum (PIM) and Request for Proposal (RFP).

The Centre may re-invite the bid for the company in due course, according to a government official.

An association of CEL employees moved the Delhi High Court, alleging that the two bidders were related parties and sought disqualification.

An inter-ministerial panel looked into the allegations by the association and concluded that it did not come across any lapses in overvaluation and that the process had been followed with due diligence as per law.

However, it held non-disclosure of the pending case in NCLAT as a ground for disqualification.

The government approved CEL's sale in November 2021 to Nandlal Leasing and Finance for Rs 210 crore. The other bidder was JPM Industries.