Police digital radio deal raises questions

CHENNAI: The Tamil Nadu police have overruled many objections and bypassed rules to award a Rs 88 crore digital radio system contract for forces in Chennai and Trichy police, documents available with TOI show.

The project called APCO is funded by the government and the Centre's Modernisation of Police Fund (MPF). When it was launched in 2012-13, it was to be executed at a cost of Rs 38 crore. Three years later, finally the project for supply of items like walkie talkies, associated software, laptops and generators and a control room was awarded for a enhanced cost of Rs 88.06 crore. A joint bid by two companies won the contract, as they remained the sole bidders for the communication system which would not work in the sensitive underground sections of Chennai metro rail. When demanded, the contractor said it was not mentioned in the original tender condition.


Another compromise was made on the GST payment front. Though tender conditions make it clear the contractor ought to bear tax liability, the GST kicked in by the time the tender took final shape.

Also, the police department did not negotiate with the contractor, though it is a standard procedure. This issue figured on a list of objections raised by home secretary Niranjan Mardi in his communication to DGP T K Rajendran in September 2017.

In the letter, Mardi asked why police accepted the bid though the bidder did not have a dealer possession license (DPL) before signing the contract agreement and purchase order. Mardi pointed out the firm had only given an undertaking that they would submit the mandatory documents by end of July 2017.

In his response, Rajendran said the contractor submitted the DPL in December 2016, but did not reveal why the dealer gave an ‘undertaking’ to submit the documents later. Also, though the company refused to negotiate the prices till the award of contract, it suddenly offered a ‘one-time discount’ of Rs 2.31 crore, when the DGP office requested another Rs 5 crore from the government for GST dues. More importantly, the successful bidder priced similar components differently and supplied same materials at a higher cost, reveal details provided by a whistleblower.

For instance, mobile equipment with GPS, internal speakers and encryption (without accessories) was supplied at Rs 1.05 lakh each for 552 pieces. Earlier, the same contractor had quoted Rs 84,373 a piece for 98 pieces. This alone cost more than Rs 3.8 crore for the exchequer.

In the case of handheld device (with GPS) too different rates were quoted. While 1,800 pieces were sold for Rs 67,801 a piece, another set of 330 pieces was sold at the rate of Rs 61,416 a piece which cost another Rs 1.15 crore for the exchequer. The state lost about Rs 20 crore.

Director general of police T K Rajendran could not be reached for comment despite repeated calls to his office.Mardi disconnected a phone call as soon as the name of the tender was mentioned. He remained unreachable thereafter.