TEAM HERALD
PANJIM: The government and its apparent bid to obfuscate its functioning and find short cuts have come under fire from within components of the Goa Tourism Development Corporation itself. The Tourism department, already under fire for its tours and expenditure incurred on tours with the CAG pulling it up, has now sought to create a committee – state level marketing committee (SLMC) – to plan, finalise and pay for tourism related activities without the consent of the board. This is even though the government has already designated the GTDC as a special purpose vehicle (Item number 6, 130th Board meeting) for all tourism activities and all funds for tourism projects are deposited into its accounts.
According to insiders, neither the memorandum nor the companies act permits the GTDC to form any committee not constituted of its own directors and even then the powers of the committee are subject to conditions under the Companies Act and requires the approval of the board for each specific expenditure. And expenditure without board approval is “illegal”, according a strong stand taken by a section within the GTDC’s board.
This assumes significance because the all important State Level Committee now takes all decisions regarding marketing and promotional spends on travel marts, road shows and advertising, which is the major expenditure of the Tourism department and is headed by GTDC Chairman Nilesh Cabral.
According to an email sent by TTAG President Francisco Braganza, who is a member of the GTDC Board accessed by Herald, certain members including Gurudas Shirodkar, Jayant Jadhav, Keshav Naik and Francisco Braganza had raised the issue of certain payments by the corporation towards events not approved by the board, at the 134th board meeting on 20.2 2014, leading to the managing director Nikhil Dessai to explain at the meeting that the amounts spent for the events were paid as per a cabinet decision and the cabinet decision was ratified by the board of directors. (in its 129th board meeting)
Also according to Dessai, the decision of the SLMC were independent decisions and the board would not be made responsible for the same.
However, the members had expressed their reservations about the argument and the reasoning recorded in the minutes and also argued that the minutes did not record their view point.
“Our concern was that we as members of the board should not be accused of wrong doing and conduct in breach of any law. The minutes I have received of the last board meeting along with the notice seems to record at item no 15 your answer to the issues raised by us without recording the issue raised by us in detail,” states Francisco Braganza in his email, to the MD GTDC.
“It is one thing to create a state level marketing committee and to authorize it to hold events, roadshows, etc and it is another thing to incur expenditure through an account opened in the name of the GTDC irrespective of the nature of the account,” says Braganza, who is also one of the top lawyers of his generation.
It’s clear that all wheels of the special purpose vehicle created to ensure that Goa Tourism’s marketing and promotion, which has the major chunk of the budget are not in sync. And the issues raised by Francisco Braganza can’t be ignored and even a new special vehicle needs to be created, doesn’t it have to function within the rules of GTDC or new rules created.
GTDC: Who should control the spends
Francisco Braganza (from his email and documents sent to MD GTDC)
There’s no provision to incur expenditure without the approval of the board of directors, hence the State Level Committee has no authority to clear expenditure
Once funds are in the company they are under the control of the GTDC and the expenditure requires board approval even if there is a cabinet decision, general approval of the scheme or cabinet decision creating an entity cannot override the company law. To empower the cabinet to do so, requires a provision to that effect in the memorandum and articles
No investment or expenditure can be made by the GTDC based on a decision of a committee whose members are not directors of the company
GTDC General manager Sanjay Chodnekar, on behalf of MD Nikhil Dessai
The State level marketing Committee was constituted by a decision of the cabinet, duly ratified by the Board. Therefore the Board’s concurrence is duly stamped
The Committee consists of Chairman, MD GTDC, Director Tourism (both Nikhi Dessai) and industry professionals. So the GTDC controls it
There’s a precedence for this arrangement. The handicrafts corporation has a rate contract committee, similarly constituted that takes all decisions
The GTDC board has ratified the cabinet decision
