MANGALORE: The chocolate factory of Central Arecanut and Cocoa Marketing and Processing Cooperative Ltd. (CAMPCO) at Puttur suffered an accumulated loss of Rs. 19.77 crores at the end of 2003-04.

The trend seems to have continued as the loss stood at Rs. 2.38 crores in December 2004, sources said.

The loss, allegedly brought about by some irregularities at the factory, has caused concern about the future of the factory among farmers and the Government — CAMPCO's stakeholders.

The Board of Directors of CAMPCO, in its meeting on March 19, resolved to suspend R. Sridhar, Deputy General Manager of the factory, pending inquiry against him based on three official reports.

Subsequently, the Managing Director of CAMPCO suspended him pending inquiry on March 22. The official was working with the factory since September 2001.

The loss suffered by the factory has been attributed to wrong purchases and sales policies followed by the authorities concerned.

Sources told The Hindu that instead of purchasing cocoa dry beans from farmers, the authorities purchased them from traders in violation of "byelaw 4 (1) of CAMPCO." On the other hand, the factory sold cocoa butter to some private companies at rates lower than the price fixed by CAMPCO.

A case in point is cocoa butter sold to Gujarat Milk Union Ltd., a cooperative society, at Rs. 185 a kg.

Rules violated

The three official reports submitted to the Board of Directors note these factors and other lapses at the factory.

The reports say that the factory authorities violated rules resulting in irregularities and financial losses.

R.D. Shastry, a chartered accountant appointed by CAMPCO to look into the affairs of the factory, submitted his inquiry report on April 12, while the internal audit wing of CAMPCO submitted its report on January 1 and the secretary of CAMPCO on February 2.

The factory commissioned in 1986 is said to be the biggest chocolate factory in the cooperative sector in the country. In the first three years after its commissioning, it suffered losses. However, it registered profits worth Rs. 27.53 lakhs in 1990-91. The maximum profit the factory made was Rs. 1.91 crores in 2001-02.

Quoting a report, sources said that of the cocoa dry beans stocked at the factory, 69 million tonnes of beans were rejected by the Quality Control Department on the ground that they were "smoky and putrefied." They had been received from Dharapuram and Ponkunnam branches of the CAMPCO.

The value of the beans is estimated at Rs. 75 lakhs and its utilisation has been ruled out. Also, chocolates and other products worth Rs. 10.92 lakhs are yet to be lifted.

Sources said the copper sulphate manufacturing unit of CAMPCO also suffered an accumulated loss of Rs. 58.84 lakhs in 2003-04.

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