Staff Correspondent

The Summit Industrial and Mercantile Corporation has requested the government to review its decision on excluding the company from the tender processes for the 330–450MW Bibiyana and Sirajganj independent power plants claiming that it had been declared non-qualified 'not based on proper fact.'

Summit, the only local company to apply for pre-qualification for the tenders, in the past week sent separate letters to the Power Cell director general and forwarded it to the Power Division requesting the revision, said sources in the cell and the division.

The chief adviser's special assistant M Tamim said on Wednesday they had received the letters of Summit. 'We have asked the Power Cell to make comments on the issue as the tender process is handled by the cell.'

The government has selected four foreign companies and consortium to take part in the tender for the Bibiyana plant and three of them for the Sirajganj plant on the recommendations of the tender evaluation committee, headed by the Power Cell director general, Abdul Jalil.

Sources in the Power Cell said the tender evaluation committee had almost nothing to do with process as the pre-qualification applications for Bibiyana were evaluated by the International Finance Corporation of the World Bank and for Sirajganj by the Asian Development Bank.

The tender committee, however, agreed to the observations of the IFC and the ADB, appointed by the government for advisory supports. Sources in the cell said Summit's letters were sent to the IFC and ADB consultants for their comments.

'We will communicate with the Power Division after we get their comments,' said a source. Initially, the consortium of the Summit Industrial and Mercantile Corporation and the US-based GE Energy was conditionally pre-qualified to take part in the tender for Bibiyana.

Summit, which submitted the financial statement as directed by the tender committee, was declared non-qualified as the International Finance Corporation observed that it had not fulfilled the conditions in the financial statements.

Sources in the Power Cell said the IFC consultants observed that Summit did not have the net worth of $100 million as they took into consideration the consolidated figures of the Summit Group — the Summit Industrial and Mercantile Corporation and its subsidiary, Summit Power Limited.

In the letter for Bibiyana, Summit said, 'It appears to us that the Power Cell made the aforesaid conclusion [to exclude the SIMC] on the basis of "consolidated" figures [of the Summit Group], not the "company" figures.

The company [SIMC] is the legal entity, not the group which has no legal recognition either in the Bangladesh Companies Act 1994 or the Bangladesh Income Tax Ordinance 1984.' Referring to Section H.2.2 of the pre-qualification documents, 'We would like to point out that the consolidated figures do not represent the fair value of our net worth as these are based on the historical costs; whereas the company figures are stated at fair values as per the IAS/IFRS issued by the international accounting standards committee/board.'

Summit was declared non-responsive in the Sirajganj tender, but was not given any clarification why it was declared non-responsive.

Referring to a report that said that Summit was not selected for Sirajganj showing the cause that it did not have net worth of $100 million, in its letter, Summit said, '…we have submitted our financial statements to the Power Cell that are IAS-compliant and our financial statements for the three months ended on September 30th 2007 audited by SF Ahmed and Co, one of the leading audit firms in the country and the representatives of Ernst and Young, clearly demonstrate that the net worth of the company as on September 30th was equivalent to $121,025,082'.

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