Machinery bought for income growth is consumer purchase

Shivajirao More approached Siddhanath Sawant with a proposal that the latter should start a grey-board manufacturing unit, which the Khadi and Village Industries Commission recognised asa family activity.

- JEHANGIR B GAL

More also represented that he had the technical know-how and a tie-up with Mangalam Engineering Works, which had the licence to manufacture and supply the machinery and to erect and install it.

On September 17, 1999, Mangalam gave a quotation of ₹79.5 lakh for providing, installing, and commissioning the unit by May 1, 2000. Sawant arranged finance of ₹77 lakh from Maharashtra State Cooperative Bank, Pune branch. The parties also executed an agreement for carrying out the project.

‘After receiving an advance payment of ₹9.5 lakh, More submitted a false inspection report from a recognised electrical contractor to show that the machinery had been installed, and managed to obtain sanction from the Maharashtra State Electricity Board (MSEB) for a 15 HP (horsepower) electric connection. However, MSEB refused to give the connection after learning that the inspection report was false.

Sawant subsequently purchased the greyboard machinery from Shree Mahalakshmi Industries by spending an additional amount of about ₹76 lakh. He also cleared all the objections raised by