Firms that supply lentils to five prisons, including the Kashimpur Central Jail, are jointly involved in severe irregularities, by agreeing to deliver the essential food item for far less than the market rate, but charging retail prices anyways.
The matter came to light after a firm complained to the Competition Commission. Later, the prison authorities engaged in a hearing with the lentil suppliers. Following the hearing, the Competition Commission compiled an inspection report.
According to that report, Ajay Brothers made the lowest bid to supply lentils for Tk 76 per kg, and won the contract to supply the food item to prisons. The firm then made an agreement – that serves no purpose – with Asia Trading to buy lentils at that price.
Usually, the superintendents of central and district prisons invite tenders after checking prices on web portals of the Trading Corporation of Bangladesh and Department of Agricultural Marketing.
Data from those sources show lentils of the lowest quality are being sold for Tk 96 – Tk 97 in the wholesale market, and for Tk 105 – Tk 110 in the retail market. The price of this kitchen essential exceeded Tk 100 on September last year,
However, the Department of Prison gave a work order to a contractor to supply coarse lentils at Tk 76 per kg to five of the country’s largest central jails.
A contractor firm, on condition of anonymity, said, “The firm that received the work order may be colluding with the prison employees, and could tamper with the bill by supplying a less amount or showing a larger number of prisoners.
“This may be a ploy to embezzle government funds in the name of feeding the prisoners.”
Department of Prison sources say Chattogram-based Ajay Brothers won the contract to supply coarse lentils to Kashimpur Central Jail 1 and 2, Kashimpur Women’s Central Jail, Kashimpur High Security Central Jail, and Dhaka Central Jail from April 2023 to September 2023.
In a letter to the Competition Commission, the deputy inspector general of prisons stated that the tender evaluation committee has asked Ajay Brothers to show cause on why they submitted prices lower than the market rate.
In response, Ajay Brothers stated that it will be able to supply coarse lentils at the mentioned rate. So, the tender evaluation committee selected Ajay Brothers as they bid the lowest.
According to a complaint submitted to the Competition Commission, in recent times, Ajay Brothers, Md Jaher IR Trading Corporation, and a few others are participating in the Department of Prison’s tender process, and accepting work orders by submitting abnormally low prices.
The complaint mentions that the malpractice committed by firms such as Ajay Brothers is damaging healthy competition.
During a Competition Commission hearing, representatives from Ajay Brothers and Asia Trading said the companies signed a deal last March. According to this deal, after Ajay Brothers gets the work order, Asia Trading will supply lentils to the country’s central and district prisons.
The lowest bid was Tk 76 per kg of lentils. When asked whether Asia Trading is supplying lentils at the mentioned price, the firm’s Sajal Muhuri told the commission that he is supplying the food item at the market rate, not at the bidding rate.
Asia Trading has supplied 124 tons of lentils at the market rate to prisons.
Meanwhile, Ajay Brothers owner Ajay Kumar Nandi told the commission that the deal was signed in response to a tender evaluation committee query, seeking explanation on how the firm is planning to supply lentils at a price far lower than the market rate.
Both the companies and the prison authority admitted that the deal in question has no practical purpose. The commission then observed that the tender evaluation committee should more thoroughly evaluate all deals and agreements before awarding contracts.
The commission recommended that the Department of Prison should ensure fair competition, under existing rules and regulations, in the procurement process of lentils.
It also suggested that the home ministry’s Security Services Division should conduct an investigation on reported irregularities in the goods supply process in prisons, and the involvement of five contractor firms owned by one family in this matter.
It should be noted that on September 1 of 2020, Chattogram Central Jail invited a tender for the procurement of lentils and chickpeas. Seven firms participated in the tender process, and Ajay Brothers was the lowest bidder with Tk 49.30 for per kg of chickpeas.
The tender evaluation committee recommended this firm. During the period, chickpeas were selling for Tk 70 – Tk 73 in the wholesale market, and Tk 75 – Tk 78 in the retail market. Ajay Brother faced allegations of irregularities during that time too for bidding abnormally low.
On August 21, the Department of Prison informed the Competition Commission Raj Trading Medicine Corner won the tender to supply lentils to Kashimpur Central Jail-2. Ayub Traders then sued Raj Trading and won the contract.
The owners of these two companies belong to the same family, and there are allegations that they conspired to artificially raise the prices of lentils being supplied to the prison.
A Department of Prison representative further informed the commission that several suppliers are creating undue complications in the process of supplying food items to prisoners.
Among them, there is Ayub Ali, proprietor of Ayub Ali Traders, his sons Yahia Enterprise proprietor Md Yahia and SM Enterprise proprietor Md Solaiman, Ayub Ali’s brother-in-law Raj Trading Medicine Corner proprietor Md Alamgir Ahmed, and Jamata Dil Enterprise proprietor Md Anwar.
‘So that my business can survive’
Speaking to The Business Post, Ajay Brothers proprietor Ajay Kumar Nandi said, “Firms need two years of consecutive experience of supplying goods under a tender process to participate in future bids.
“So I participated in the tender process with abnormally low prices so that my business can survive. The PPR 2008 should be amended to mitigate this problem.”
Commenting on signing a deal that has to practical purpose, he said, “The prison authority asked for an agreement to ensure low prices of goods. This is why we had to make a deal with Asia Traders.”
“Sometimes we are able to make a profit by participating in the tender process, sometimes we incur losses. It is difficult to figure this out beforehand. We usually try to purchase goods at lower prices during the season, or import those at a cheaper price.”
SM Enterprise proprietor Md Solaiman and Ayub Ali Traders representative Md Ismail Hossain told the correspondent that it is not illegal for members of the same family to engage in similar businesses.
The duo added that they have separate trade licences, and they do business separately.
It should be noted that the Competition Commission is working to ensure healthy competition among businesses, thwart collusion among firms, and anti-competition malpractices.
