RTI activist suspects Rs 1000 crore bitumen scam

An RTI activist has moved the Madras High Court to order a CBI probe into the alleged Rs 1,000 crore bitumen scam.
RTI activist suspects Rs 1000 crore bitumen scam
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CHENNAI: An RTI activist has moved the Madras HIgh Court to order a CBI probe into the alleged Rs 1,000 crore bitumen scam. In his PIL, G Balaji alleged that officials of State Highways department, in collusion with contractors, had siphoned off Rs 800 to 1,000 crore from 2014-16 in the guise of procuring bitumen for road laying and maintenance works.

According to the petitioner, the Highways department gets allotment of about Rs 3,000 crore every year for carrying out road and bridge works under the comprehensive road infrastructure development programme (CRIDP). A major portion of this sum is spent for procuring bitumen, steel and cement. The price of bitumen varies on a monthly basis as fixed by oil companies based on market value. When the price shoots above the sanctioned amount at the time of granting the contract, the department bears the additional cost. Similarly, when the price falls, the difference has to be returned to the department, and if not, has to be recovered by the department. This is where officials collude with contractors and divert the difference to their pockets, the petitioner alleged.

For example, bitumen price in September 2014 was Rs 41,360 per tonne when estimates were sanctioned for the works approved under CRIDP 2014-15. The price reduced gradually and stood at Rs 30,260 in March 2015, when works were executed and billed. The difference in price was Rs 11,000. Similarly, the rate in September 2015, when works were sanctioned for 2015-16 was Rs 31,100 and when the works were executed and billed in March 2016, it was Rs 23,146 with a difference of Rs  7,954.

The department approximately allots 4,000 km of road laying and maintenance works per year. Requirement of bitumen for 1 km is about 100 tonnes, therefore for the entire scheme the bitumen requirement is four lakh tonnes.

Based on the difference in price of bitumen in 2014-15 and 2015-16, the total value reduction for the entire scheme would have been Rs 444 crore and Rs 318 crore, respectively. That works out to Rs 762 crore for two years alone, the petitioner pointed out.

“The divisional engineers concerned should have reduced the prices taking into account the reduction of bitumen price and paid the bills for the reduced value. If they had done so, the amount would have reached the government treasury. Instead, the officials in collusion with the contractors siphoned off the entire money into their pockets,” the petitioner said.

Submitting proof he had gathered through RTI applications from the department, the petitioner wanted the court to order a probe by the CBI or any other independent agency.

The black hole

  • Rs 41,360 Per tonne cost of bitumen in September 2014, when estimates were sanctioned for the works approved under CRIDP 2014-15
  • Rs 30,260 Cost per tonne in March 2015, when works were executed and billed
  • Rs 31,100 Per tonne rate in September 2015, when works were sanctioned for

2015-16

  • Rs 23,146 Cost when the works were executed and billed in March 2016
  • 4,000 km Road laying, maintenance work allotted by TN highways department each year on an average
  • 100 tonnes Bitumen needed for work on 1 km, so total requirement is four lakh tonnes.
  • Rs 762 crore Price drop of bitumen between 2014-15 and 2015-16, but was not passed on to the exchequer

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