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LATEST NEWS UPDATES | Delhi govt favoured private discoms: CAG

Delhi govt favoured private discoms: CAG

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published Published on Apr 3, 2013   modified Modified on Apr 3, 2013
-The Indian Express


Report finds govt did not recover dues of Rs 750 cr from distributors.

At a time when the opposition BJP plans to intensify protests against power tariff in Delhi, the Comptroller and Auditor General (CAG) of India's report for the 2011-12 fiscal has slammed the Delhi government for not recovering dues to the tune of Rs 750 crore from private distribution companies.

The report, tabled on Tuesday in the Delhi Assembly, says Delhi Transco Limited (DTL), responsible for power transmission, extended undue benefits amounting to over Rs 700 crore to private discoms - BRPL and BYPL. According to the report, "undue benefit was extended to private Discoms (BRPL and BYPL) due to not following the provisions of agreement resulting in non-recovery of long pending dues of over Rs 700 crore".

The CAG report observed, "Audit notices that DTL was dependent on borrowings for its capital projects, while a huge amount of Rs 705.7 crore was blocked due to non-payment of transmission charges by private discoms." According to the CAG, DTL had no financial safeguard to recover these dues as "it did not ensure submission of LC or operation of escrow accounts by two discoms (BRPl and BYPL) as per agreement".

The BJP and Arvind Kejriwal's Aam Aadmi Party, have recently been demonstrated against the Delhi government claiming it favoured private discoms and alleging a nexus between the two.

However, BRPL CEO Gopal Saxena said it was in fact a huge revenue gap that resulted in the non-payment of dues. "The revenue gap for the three discoms in Delhi is about Rs 19,000 crore. This build up has arisen because of low tariff rates, which we have taken up with the Delhi Electricity Regulatory Commission (DERC). We acknowledge the unpaid dues and will endeavour to clear them as soon as possible," Saxena said.

The CAG report has also stated that the DTL's abnormal delays and deficient planning had resulted in cost overruns amounting to Rs 109.40 crore and loss to the tune of Rs 644.42 crore. The report read, "Lack of synchronisation between inter-connected projects and delayed execution resulted in blockade of funds of Rs 287.09 crore.

Assessment of key sectors reveals poor planning, lack of focus

Underutilised funds, poor planning and deviation from policy formed the gist of CAG's state audit report on Delhi for the 2011-12 fiscal. Despite impressive revenue collections, the CAG found defects in the implementation of projects under most Delhi government departments.

Delhi Police

Delhi Police failed to modernise its communication network as most of the funds earmarked for the purpose were not utilised. The CAG report found that Rs 8.476 crore was approved during 2007-08 and 2011-12 for the Communication Unit but only Rs 2.70 crore (27 per cent) was utilised. The report observed, "As of March 2012, implementation of Intelligent Traffic System could not be started due to deficient planning, thereby depriving users of a world class traffic system in Delhi, and leading to an unfruitful expenditure of Rs 7.5 crore."

Transport

The Delhi Integrated Multi Modal Transport System (DIMTS), now a private company, came under heavy criticism in the CAG's state audit report for receiving special treatment from the Delhi Transport Department. "DOT awarded work on nomination basis to the company in violation of established financial norms. DOT also accepted proposals submitted by DIMTS without any financial and technical scrutiny," the report said. "DOT also implemented the cluster buses scheme without a well laid-out plan and concurrence of the finance department or legislature," the report said.

Taxes

The CAG has recommended better transparency in tax collection in the national capital, citing a loss of around Rs 2,300 crore to the exchequer in the 2011-2012 fiscal. "Irregular claim of exemption/concessional rate of tax without furnishing proper statutory forms resulted in short payment of tax of Rs 2310.14 crore including interest of Rs 404.30 crore," the CAG report said. CAG also observed that of the 304 cable TV operators in Delhi, 123 (39 per cent) did not pay tax during last three years and 175 (58 per cent) failed to pay Rs 1 crore in taxes." The department failed to pursue the arrears of entertainment tax to the tune of Rs 1.26 crore from 12 cinema hall owners and luxury tax amounting to Rs 9.76 crore from hoteliers.

Water and Sewage

The CAG report observed that the average per capita water supply of 3.82 liters per day fell far short of the prescribed norm of 172 litres. It also stated that the Delhi Jal Board (DJB) added only one million gallons per day (mgd) capacity of sewage treatment. "The DJB was able to collect and treat only 364 mgd (54 per cent) of 680 mgd of sewage generated in Delhi. The remaining sewage was discharged untreated into the Yamuna," the report states.

Health

Commenting on Delhi's health services, the CAG report stated that ambulances in the GTB and LN hospitals were used for miscellaneous purposes instead of treatment of patients. It said the ambulances were not equipped with essential equipment for basic life support system. The report says: "Despite continuous increase in patient load, no exercise was carried out to fill critical vacancies."


The Indian Express, 3 April, 2013, http://www.indianexpress.com/news/delhi-govt-favoured-private-discoms-cag/1096854/0


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