… Complainant detained in Nganglam in connection with a coal business

Rinzin Wangchuk 

The Anti-Corruption Commission (ACC) has dropped all allegations of corrupt practices against the Dungsam Cement Corporation Limited (DCCL) management after conducting a review of the complaint letter they received recently. The ACC concluded that there was no “element of corruption” in the case.

According to ACC officials, they have directed the complainant to seek resolution through the court if DCCL refuses to comply with the court’s judgment. The court ruled that DCCL is not permitted to use the complainant’s Indian market approvals.

The former coal vendor and DCCL’s export agent, Kunga lodged a complaint requesting ACC to investigate DCCL for deceiving regulatory authorities, misuse of authority, manufacturing and supplying inferior quality cement and not adhering to the court’s order. 

He accused the company of using his Indian market approvals and enlistments, despite a court ruling that the ownership of these approvals belonged to the authorised agent. He also alleged that DCCL was manufacturing cement that did not meet the licensed standards and supplying defective cement for export.

Association with DCCL

DCCL, with its cement plant having a production capacity of 1.2 million tons per annum, markets its products under the brand name “Dragon Cement.” Kunga had been associated with DCCL as a coal vendor and dragon cement export agent for three years given his network and public relations in India’s north-east region.

After three years of hard work and huge expenditure, he managed to get nine much sought-after Indian market approvals and enlistments in February 2017, according to one of Kunga’s siblings.

She claimed that DCCL, with a high-powered Sales and Marketing (SM) team consisting of a full-time ex-pat specialist vice president, five sales personnel, and 47 distributors from India, and spending about Nu 2B, could not obtain a single approval. “Dragon Cement, a new and unknown foreign cement brand, became prominent in the cement market valued over INR 1,500B in Assam, Indian Railways, and Sikkim because of my brother’s hard work and connections.”

Kunga handled bulk supply orders valued at over INR 161M. More bulk supply orders were lined up. His sister claimed that just as her brother was about to execute export supply in bulk, DCCL supplied him with adulterated cement on three occasions. DCCL’s plant was shut down in February 2017, and his market, valued over a billion per annum, came to an abrupt end. 

After the quality defect surfaced, Kunga’s Indian client rejected 1,104 bags of Dragon Cement and directed him to take back 15 truckloads. However, DCCL refused to pay compensation for the direct damages caused, the letter submitted to ACC on April 25 stated.

In early 2017, DCCL published a commercial brochure. Kunga claimed that DCCL, without his consent or payment of cost compensation, incorporated his Indian market approvals and enlistment, which were meant for wide and free use. The matter went up to the DCCL board. In a blatant abuse of functions, according to his sister, DCCL refused to pay cost compensation. Kuensel learned that he claimed compensation of Nu 6M for establishing networks.

According to officials from DCCL, there were cases where some consignments were rejected by Indian clients. “However, we had replaced those cement brought back from India after testing the quality at DCCL,” an official from the marketing division said, adding that all allegations against DCCL were baseless.

The company also did not renew his export agent contract after the completion of the three-year period in mid-2017, as he failed to pay the cost of cement amounting to Nu 5.214M. DCCL then filed a case against Kunga before the Nganglam Drungkhag  Court. From the trial court to the Supreme Court, the ruling was in favour of DCCL. “We are going to enforce the judgment to recover Nu 5.214M from Kunga as per the court order,” DCCL’s legal officer said.

The defendant’s sister claimed that the courts, in their wisdom, did not address glaring criminal intent that qualified for reparation in terms of cost compensation and consequential damages. “Even his legally and rightful entitlements for sales incentives as per DCCL sales policy and the refund of performance security were rejected,” she said.

Allegations of coal syndicate

Kunga also accused DCCL of being involved in a coal syndicate that manipulated the coal supply and caused significant losses.

He claimed he was the first Bhutanese to qualify for a Letter of Acceptance (LOA) for a sealed tender bid to supply 30,000MT of coal to DCCL. The success was cut short, according to his sister. His company, Yangnor, faced sabotage from an Indian company orchestrated by the syndicate to derail his DCCL coal venture.

He alleged that the Indian company supplied adulterated coal, deceiving the customs and police authorities at the international border gate.

DCCL officials countered the allegations, stating that they had strict quality control measures in place for coal suppliers, including the State Mining Corporation Limited (SMCL). “We have a robust system in place to ensure the quality of coal supplied meets the required specifications,” one official said.

Kunga’s complaint letter to the ACC expressed his desire to expose corruption and rectify the damages caused. He offered to provide leads for the investigation and assist in identifying areas for recovery.

Meanwhile, Kuensel learned that Kunga was handed over to the police in Nganglam by Indian authorities on March 9 after he was caught in Guwahati, Assam by the coal suppliers to whom he owed money. “We heard that our brother was abducted by the coal suppliers when he was in Guwahati,” one of his relatives said.   

He is being tried at the Nganglam court after the case was registered by an Indian supplier. “Our brother got sucked into bizarre and mysterious business disasters in Nganglam with serious criminal conspiracy in nature,” his sibling said.