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CAG Raps Puducherry Govt Over Karaikal Port Project

Published: 24th September 2014 06:05 AM  |   Last Updated: 24th September 2014 06:05 AM   |  A+A-

PUDUCHERRY: The concession agreement (CA) for the development of the Karaikal port in phases under the public- private partnership (PPP) mode contained various deficiencies, including failure to safeguard the financial interest of the Territorial government, a report from Comptroller and Auditor General for year 2012-13 said.

The financial and operational audits were not conducted and the concessionaire was allowed to develop subsequent phases of the port without submission of the revised detailed project report.

Also, the CAG found fault with the selection of the concessionaire as the UT government issued expression of interest (EOI) for port development without specifying pre-qualification criteria for selection of the concessionaire, without adopting pre-determined quantitative and qualitative parameters. The revenue share of 2.6 per cent was fixed after award of the contract, defeating the very purpose of competitive bidding. The monitoring system of the port was weak due to the failure of the UT government in appointing a director to the board of directors of the port, non-engagement of an independent engineer, non-constitution of separate bodies for monitoring project, irregularity in operation of escrow account, non-conducting of annual physical verification of assets of the projects .

Further, the report said the failure of Revenue Department to verify title deeds and auction of the project implementation agency in releasing cash assistance to beneficiaries without any binding condition for recovery in case of default resulted in wasteful expenditure of `52.92 lakh.

Calling tenders for procurement and supply of colour televisions to households free of cost, without finalising scheme guidelines resulted in non-implementation of the scheme and led to wasteful expenditure of  `40.13 lakh, the CAG said.

Adoption of wrong price indices while calculating the price variation for steel and cement also led to overpayment of  `27.36 lakh , undue benefits to contractors.

Meanwhile, delay in granting expenditure sanction for a road work under revamped central road fund also resulted in avoidable extra expenditure of  `1.76 crore.

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