The Madhya Pradesh Economic Offences Wing is investigating an alleged Rs 10.99 crore tender fraud involving computer procurement. Investigators identified collusive bidding on the Government e-Marketplace (GeM) and the supply of refurbished equipment passed off as new. The case underscores governance risks in government procurement and potential blacklisting for the involved vendors.
The Madhya Pradesh Economic Offences Wing (EOW) has opened a formal investigation into a suspected procurement fraud involving Rs 10.99 crore worth of computer hardware. The probe focuses on a tender processed for the state's Social Justice and Empowerment of Persons with Disabilities Department. Investigators have flagged serious irregularities in how these contracts were awarded and executed, revealing a pattern of manipulation that compromised the bidding process.
According to the investigation, four different companies participated in the tender process on the Government e-Marketplace (GeM). These firms were found to be operating in coordination rather than competing against each other. A forensic review showed that all four entities shared identical mobile numbers, email addresses, and GST registration details, which created a false appearance of market competition to manipulate the final contract award.
The probe also uncovered significant issues regarding the quality of goods supplied. Hardware that had been installed at government locations months before the tender date was reportedly repackaged and sold as brand-new equipment. For instance, investigators identified devices originally deployed in July 2024 being presented as fresh inventory for a tender finalized in September 2024. Furthermore, the hardware failed to meet contractual technical standards, with reports indicating the use of inferior, locally sourced RAM and SSD components instead of the specified high-performance parts.
Financial discrepancies were also noted, particularly in the pricing of hardware accessories. Investigations revealed substantial price gouging, with UPS units being procured for Rs 11,247 each, despite the prevailing market rate being approximately Rs 3,754. The EOW has confirmed issues with authorization documents allegedly provided by original manufacturers, raising questions about the legitimacy of the entire supply chain.
The agency has registered an FIR against four individuals linked to the implicated firms under the Bharatiya Nyaya Sanhita. As the legal process moves forward, authorities have recommended the permanent blacklisting of the companies involved. For vendors and businesses participating in government tenders, this case highlights the heightened focus by regulators on procurement integrity and the importance of strict compliance with tender specifications. The next steps in this case will involve tracing the full extent of the financial loss and determining the administrative failures that allowed the equipment to pass initial quality inspections.