Ahmedabad public hospital's Rs 8 crore PF scam: 'Why no action initiated for 7 yrs?'

Counterview Desk 

Board members and trustees of the Ahmedabad Municipal Corporation-run Sarabhai General and Chinai Maternity Hospitals, in letter to its chairperson with a copy to the AMC commissioner, have taken strong exception over refusal to initiate any action in the Provident Fund scam and recovery of Rs 8 crore penalty imposed by the PF commissioner.

Rupa Chinai, Brijesh Chinai, Jay Sheth and Dr Nishith Shah, who are independent board members of the hospital, in their letter said, instead of initiating appropriate action, the AMC and the VS Board chairperson and AMC corporators overnight moved to give VRS to the person responsible for the scam, deliberately letting the case lapse for seven years.

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This is with reference to a number of articles recently published in the Ahmedabad media, quoting the retired Medical Superintendent Dr S Malhan as saying that no further action can be initiated with regard to the Provident Fund scam and recovery of Rs 8 crore penalty imposed on our institution by the PF Commissioner. He further held that the Municipal Commissioner is late in putting a chargesheet against him.

This case is of serious consequence to the VS Hospital and Board. It is also about misuse and loss of public funds and lack of administration accountability.

As independent Board members, we have repeatedly demanded in writing, since 2017, that a police investigation must be initiated to ascertain who, apart from then Superintendent Dr. S. Malhan, is to be held responsible for this Rs 8 crore financial loss to our institution. (The penalty of Rs.8 crores was imposed by the PF Commissioner and the Superintendent was held responsible for overruling fixed norms on PF investments).

Instead of initiating appropriate action, the AMC and the VS Board Chairperson and AMC Corporators overnight moved to give VRS to Dr Malhan while he retained all the perks. They deliberately let the case lapse for seven years, now enabling Dr Malhan to claim that since the matter is time-barred, no further action can be taken against him.

We had repeatedly brought up this matter verbally in the Board Meetings and in written letters dated: These are the dates of letters we wrote to the Board referencing the PF scam:

• 11th Dec 2018
• 6th March 2019
• 20th July 2019
• 23rd Oct 2019
• 21st July 2020
• 5th Dec 2020
• 17th June 2021
• 21st Sept 2021
• 20th Jan 2022
• 17th Jan 2023
• 25th Jan 2023

We demand that action be initiated against then AMC Commissioner Mukesh Kumar who approved the VRS to Dr Malhan and took no further action. The Rs 8 crore penalty should be recovered from him or from the present AMC Commissioner for it is due to their irresponsibility that our public institution has suffered grievous financial loss.

We would also like to clarify that we have never approved or recognized the appointment of the Medical Superintendent Dr Malhan at VSGH or any other such subsequent appointees. These persons were thrust upon the Hospital by AMC-MET and did not go through the standard procedure of appointment as required by the Board since its inception. Hence there is no question of the Board paying for the retirement dues of Dr. Malhan and the salaries of further such appointees.

Please refer to our letters opposing the appointment of Dr. Malhan dated: 

• 5th Jul 2016
• 4th June 2017
• 8th June 2018

Kindly let us know your response. Please also provide us a copy of the entire file of investigation related to the PF Scam with a copy of the chargesheet and the reply of Dr S Malhan.