It has also decided to take similar action against Nepal Petroleum Trade Links (NPTL), another industry of Ghimire, which illegally collected more than 15,000 cylinders belonging to different companies and tampered them to bring them under the ownership of SGC.[break]
A meeting of Ministry of Industry (MoI) headed by Deputy Prime Minister and acting Minister for Industry Krishna Bahadur Mahara took the decisions after a probe team presented its findings at the ministry on Friday.
The ministry had formed the probe team to investigate into Sugam´s irregularities, which were unknown when Bureau of Standard and Metrology in Sunsari raided NPTL.
The raid conducted on May 5 had found and seized 15,314 cylinders of 24 different companies in the premises of NPTL. There were also thousands of foot and neck rings of LPG cylinders with SGC´s name engraved on them.
“NPTL was clearly replacing original neck and foot rings with the ones with SGC´s name on them,” said Kamal Bahadur Thapa, official of the Department of Commerce (DoC) and a member of the probe team.
Such action of NPTL had violated the competition law, as the existing law bars companies from collecting, dumping or changing cylinders of competitors. Such activities are regarded as anti-competitive practice as it inflicts instant loss of property and market share to the competitors.
As re-fitting of foot rings sharply deteriorates pressure bearing capacity of cylinders, making them prone to leakage and explosion, SGC by circulating such tampered cylinders had exposed consumers to grave risks.
Such action is also a violation of Consumers Rights Protection Act (CRPA), and going by its provisions, the court can slap the promoters of the company fine and imprisonment of up to 14 years.
“The MoI will immediately write to the Department of Industry, Department of Commerce, Company Registrar´s Office and Nepal Oil Corporation, among others, for initiating actions against these companies,” said a MoI official.
MoI has also decided to ask the Department of Industry to take action against Griha-Laxmi Metal Industries that supplied neck and foot rings with SGC´s name to the NPTL -- unauthorized party in this case.
Given such widespread anomalies in the market, the government has banned cylinder manufacturing companies from supplying cylinder parts.
“Now cylinder manufacturers must produce foot and neck rings themselves. They must supply complete cylinder to the related companies and are restricted from supplying rings even to the concerned companies,” Thapa told Republica.
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