FIR on Use of Imported Clinker in Walayar and the Facts on Record

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Brief of FIR VC 15 of 2016 in Palakkad **

Facts that would refute FIR 15 of 2016 in MCL **

Word of Caution during mid-2013 for reopening the Cement Grinding Unit of Malabar Cements in Cherthala due to Low Selling Price for Cement and Related Board Minutes **

Minutes of the Sub-Committee on Reoening of Cherthala Unit of Malabar Cements placed befor the Board **

Minutes of the Board of Malabar Cements Ltd directing steps for reopening of the Clinker Grinding Unit in Cherthala **

Basis for use of Imported Clinker in Walayar Plant during 2015-16 **

Malabar Cements, in addition to its integrated plant in Walaye where its mines is locatedr, also has a Clinker Grinding Unit (CGU) at Pallipuram, Chaerthala in Alleppey District which was set up in 2004. Operations in the CGU at Cherthala was stopped in 2008 due to issues resulting from due to low capacity utilisation. The CGU was re-opened in 2015. When the Walayar Plant of Malabar Cements Ltd is working in full swing producing more than 50000 MT of Cement in a month, the entire Clinker produced in Walayar (37000 MT) gets fully used there. Consequently, for operating the Cherthala Plant, Clinker has to be purchased from Open Market. In 2015, Global tenders were floated through the NIC e-procurement Portal for Purchase of Clinker due to full use of Clinker produced in-house and the Company was successful only after many rounds of e-tendering and stoppage of an experimental arrangement with the Cement Corporation of India. No Indian Companies showed interest for particinf in the tender that was given wide publicity. The imported Clinker is stored in the godowns in Cochin Port Trust and moved to the CGU in Cherthala in Trucks as per requirement.

In 2015, bought out Clinker Requirement, because of enhanced sale from the Walayar Plant and cutting and replacement of the Kiln Shell during end May- June 2016, was estimated by the Department Heads in Malabar Cements. Based on Board approval in the revenue budget of 2015-16, around 50000 MT of imported clinker was used in the Walayar Plant during 2015-16 due maintain market presence and avoid drain of Fixed Costs of Rs. 21 lakhs / day that would have resulted in a loss of Rs. 6 crores.

Overall, going by the marginal costing principle, the annual gain has been Rs. 11.55 Crores as as evident from the profitability statement

Clinker Requirment -May- June 15**

Comparison of Cost and Quality of Clinkerfrom Cement Corporation of India and Imports ** **

Board approved Revenue Budget for 2015-16 allowing use of Upto 55000 MT of imported clinker in Walayar Plant of Malabar Cements **

Improvements in Working Results due to Use of Imported Clinker in Walayar Plant during the Period of Kiln Shut down in 2015-16

FIR on Storage of Cement…….

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