The Hindu : Business : No violation, says Ashok Leyland

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Tuesday, Jul 05, 2005

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No violation, says Ashok Leyland

Special Correspondent

"Vehicles intended for humanitarian purposes"

CHENNAI: Commercial vehicle maker Ashok Leyland on Monday said that its co-operation agreement with GIAD for Automotive Industry Co. (GIAD), registered under the Sudanese Companies Act, "is not in violation of any Indian law."

The agreement, signed on February 12, 2005, outlined the terms under which the Sudanese firm would import Ashok Leyland's vehicles in SKD (semi-knocked down) condition for assembly in Sudan. The vehicles covered under the agreement were Falcon large buses, Eagle mini buses and Stallion 4X4 trucks, the release added.

The release said the agreement referred to GIAD assembling the vehicles for sales to the public and private sectors and neighbouring countries.

"GIAD has confirmed that these are intended for civilian passenger transport and humanitarian purposes and that under no circumstances, any vehicle will be used for anything other than the above mentioned purposes," the release pointed out.

Since GIAD had not opened the letter of credit within the stipulated time, the agreement had not become operational. Consequently, no transactions had been made, the release added.

The company further claimed that the co-operation agreement was entered into in the normal course of business as part of its export development thrust in several countries.

"Such agreements are not, and, in particular, this agreement with GIAD, was not informed to the company's Board of Directors because Ashok Leyland Board processes do not deal with specific country-wise operational details of the company's export function," the release said.

"The Hinduja brothers, who are not on the board of the company, have had no role in securing this agreement either directly or indirectly," the release added.

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