The textile minister has given the go-ahead to supersede the Apparel Export Promotion Council (AEPC) and appoint a government administrator to take over its management. As per the textile secretary Rashmi Verma’s letter to corporate affairs secretary Tapan Ray keeping in view the large scale fraud of government grants by the Council, it has been decided that the government may appoint an ‘Administrator’ to takeover the management of the Council so that its functioning may be streamlined to protect public interest.

Verma requested Ray to examine the possibility of appointing a ‘government administrator’, superseding the existing executive body of the Council as provided in Section 397 to 400 of the Companies Act. Under the Act, a Section 8 company such as AEPC can be ‘superseded’ and a government administrator be appointed only through the Company Law Tribunal under the Ministry of Corporate Affairs.

According to sources, the Textiles Ministry had received a plethora of complaints against AEPC on issues of corporate governance, mismanagement of funds, misuse of Apparel International Mart and illegal leasing of office space in Delhi to benefit a private firm. While taking cognizance of the transgressions, the ministry started issuing ‘corrective actions’ since June 2015. Reminders were sent but ‘AEPC, despite clear directions from the Ministry under Article 101 (i) has shown disobedience and not willing to improve its corporate governance,’ wrote Verma.