Irregularities cost PSUs Rs4,500 cr: CAG

Irregularities cost PSUs Rs4,500 cr: CAG
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First Published: Tue, May 15 2007. 07 38 PM IST
Updated: Tue, May 15 2007. 07 38 PM IST
New Delhi: The country’s top auditor has found major irregularities amounting to Rs4,547.90 crore in the functioning of leading PSUs, including Food Corporation of India, Airports Authority of India, ONGC and Indian Oil Corp.
In a report tabled in Parliament on 15 May, the Comptroller and Auditor General of India said the delay by ONGC in awarding contract for installation of unmanned platforms in the Bombay High oilfields resulted in re-tendering. This escalated costs by Rs235.51 crore.
“The company incurred an avoidable expenditure... due to its failure in awarding the contract in time,” it said.
In case of IOC and Bharat Petroleum Corporation Ltd, the auditor found these companies inaccurately calculated advance income tax. This resulted in “avoidable payment” of interest of Rs130.91 crore by IOC and Rs34.84 crore by BPCL during 2000-05.
FCI hired godowns from state warehousing corporations instead of Central Warehousing Corporation and incurred extra expenditure of Rs348.61 crore, CAG said.
Besides, it did not properly use the space acquired and paid rent of Rs287.90 crore for a storage capacity, which was kept idle from February 2002 to March 2006.
CAG also pulled up FCI for excess payment of Rs406.21 crore on account of transportation charges for custom-milled rice.
CAG also found irregularities in Steel Authority of India Ltd, Oriental Insurance Company Ltd and United India Insurance Company Ltd.
SAIL came in for sharp criticism, as the CAG said the steel maker did not dispose off 35.04 tonnes of iron ore fines accumulated at Gua Ore Mines. This resulted in non-realisation of revenue to the tune of Rs1,507 crore up to March 2005.
The report said Indian Airlines incurred an avoidable expenditure of Rs68.40 crore on outsouring of repair and overhaul of engines. Besides, the state-run carrier lost revenue of Rs45.96 crore due to grounding of aircraft from July 2005 to June 2006.
The Airport Authority of India did not levy royalty as per court’s directive on gross ground handling revenue earned by the operating agencies at international airports resulting into a loss of Rs18.48 crore, CAG said.
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First Published: Tue, May 15 2007. 07 38 PM IST
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