AG reveals more BOI bungling
Failed to collect rent for land given to Garment Company
Granted loan without 3rd Party guarantee

The Board of Investment had allotted a land of 2 Acres, 3 roods and 20.5 perches valued at over Rs. 3 million for an annual rent of Rs 974,335 to a garment manufacturing company that had defaulted its annual rent payments from 2002 to 2006. The company had imported goods to the value of Rs. 13,221,210 under duty waivers but exported garments to the value of only Rs.9,153 during this period the Auditor General’s report on the BOI Annual Report for 2006 presented to Parliament last week stated.

The BOI had also granted an interest free loan of Rs.11,502,145 to this company under the Financial Assistance Programme for construction of a factory building and BOI had not obtained a third party guarantee from a bank or an insurance company. Instead of submitting a third party guarantee the company had delivered a Corporate Guarantee to pay back the loan. However the company had not paid back the loan from 2002 to 2006 and the BOI had taken no legal action against the company or the Directors of the company, the AG’s report noted.

The BOI that had rented the land for 50 years and failed to recover Rs.4,212,112 for the period 2002 to 2006, the AG’s report added.

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