The case, said the Jagdambika Pal-headed panel, pertained to 2008-09, a year after MSTC ventured into gems and gold jewellery exports. Its 46 foreign clients defaulted Rs 598.63 crore payments, citing economic slowdown as the main reason.
Of the 46 clients, 44 were from UAE, while the other two were from Kuwait and Singapore.
"Till date, out of 46 cases in all, MSTC has managed to secure decrees valued at Rs 672.30 crore in 43 cases in the UAE and also filed execution cases in respect of 12 defaulting buyers...Take all these cases to their logical conclusion to ensure the interest of the public exchequer," the Committee on Public Undertakings, said in its report tabled in Parliament.
"Investigation is in progress both by CBI and ED at their ends...In order to send the perpetrators of fraud behind the bars, it is necessary that the investigations should be brought to the logical conclusion at the earliest," the Committee said.
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It also recommended that the Ministry "through constant monitoring and coordination with all agencies including diplomatic channels, ensure expeditious completion of the probe by the enforcement agencies so that the reality is brought to the fore and justice are served."
"Before accepting the proposals for the export business of gold jewellery, MSTC Ltd did not carry out due diligence on its part in verifying the credentials of the associates and foreign buyers and relied on the due diligence made by insurers, i.E, Export Credit Guarantee Corporation of India and ICICI Lombard regarding the foreign buyers," it said.
It said due to such a step by MSTC "huge sums of public money has been locked up in legal battle."
MSTC, formerly known as Metal Scrap Trading Corporation, is primarily in to trading of metal scrap and of late, it has emerged as a major domestic e-commerce company, through its e-auction portal.
MSTC has said it has initiated all measures within the law to recover the outstanding payments.