The Comptroller and Auditor General (CAG) of India has exposed a scam of the Haryana government in which the top brass of Faridabad municipal corporation cleared ₹183 crore worth of payments in multiple instalments of under ₹5 lakh to a single contractor for mostly cooked up city development works for five years.
The Faridabad municipality is understood to have adopted this innovative way of syphoning off public money to avoid seeking clearance from higher officials if the payment exceeded ₹5 lakh.
The initial finding of the CAG’s Accountant General office of Haryana, which was accessed by BusinessLine, revealed that contractor Satbir Singh, a resident of Parvatiaya Colony of Faridabad, was allegedly arbitrarily awarded contracts for five years, beginning in 2015, ignoring e-tendering government rules and urban local bodies department guidelines. He subsequently received payments from Faridabad municipal corporation through 588 vouchers, running into ₹183.83 crore, calculated the CAG auditors. The findings will be included in the CAG’s compliance audit report on urban local bodies department of Haryana for the year March 31, 2022, and made public subsequently.
Though the corruption issue was raked up in the past, attempts were allegedly made to brush it aside. A committee constituted by the municipal commissioner on the demand of local councillors concluded in March 2021 that the government lost ₹23.65 crore since neither contractor nor junior engineer could show execution of a single out of 388 allotted infrastructure works.
The vigilance department of Haryana is learnt to have written to the chief secretary about a month ago seeking directions for a probe into the scam.
When BusinessLine sought his comment on bureaucracy’s involvement in deep-rooted corruption, Arun Gupta, the additional chief secretary in-charge of urban local bodies, stated that the State Vigilance Bureau is looking into the matter. “I cannot make any comment on this matter. The vigilance bureau is looking into it,” said Gupta, a 1992-batch IAS officer.
Interestingly, while the Taxpayer Number (TIN) and address of the contractor remained the same in the records, Faridabad municipality allegedly would mostly give him the nod on paper merely on a quotation basis. And the company’s name would have a slight variation in the initials to make it appear as if these were different entities at the time of applying. It would become either Satbira Construction Pvt Ltd or Satvi Construction Pvt Ltd, Satvi Precast Pvt Ltd, or Satvi Traders Pvt Ltd, according to the CAG audit probe.
Not just that, the irregularities committed by the municipal corporation department showed a complete disregard for Haryana public works department code and written official directions. “₹183.83 crore was disbursed to the contractor without proper documentation, indicating weakness in financial controls; ₹79.53 crore could not be vouched in the audit due to non-availability/non-production of 213 vouchers,” observed the internal note of CAG.
In November 2014, the former Director of Urban Local Bodies, Haryana, informed all the municipalities about the outsourcing policy, which was to come into effect a month later, to enforce the e-tendering system for all civil works, purchase of stores, or engagement of labour.
The order was re-issued in April 2015 with a further direction that no bifurcation of the estimates would be done of similar nature of work, otherwise strict action would be proposed against the officer for not obeying the government instructions, the auditors found out during the inquiry. Beyond that, the former principal secretary of urban local bodies department issued an order on March 31, 2015, insisting that the cost of works should not be manipulated by subdividing them so as to make their pitch remain within the competency of the municipalities and the provisions of the PWD code must always be complied with in letter and spirit.
But, from April of 2015 onwards till June of 2020, the directive was violated to give contracts to Satbir. The auditors noted that during the audit of the Municipal Commissioner of Faridabad for a year from April 2018, it was assessed that payments of 7.85 crore were made for 164 development works carried out by Satbir Singh, who gave a quotation with a slight variation in the name of his firm. The audit observed that amounts were paid on April 9, 2018 (for 140 vouchers) and July 19, 2018 (for 23 vouchers) for the development works having similarity in items executed, with same measurement and equal amounts by splitting the payment into bills having an amount below ₹5 lakh each, the audit observed.
Other than that, the auditors also discovered development works were not executed against computer generated quotations; 18 quotations were not even signed; the drawing was not approved; and the estimate of the work was also not approved. There are other glaring technical oversights which have been picked up by the CAG auditors, suggesting criminal action against government employees, including officers, and the contractor.