OFFICE OF CHIEF CONTROLLER OF ACCOUNTS
MINISTRY OF SURFACE TRANSPORT
GOVERNMENT OF INDIA
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OFFICE OF CHIEF CONTROLLER OF ACCOUNTS MINISTRY OF SURFACE TRANSPORT GOVERNMENT OF INDIA ABOUT OFFICE ABOUT US CONTACT US OTHER LINKS
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INTERNAL AUDIT some important audit paras....(contd..) NATIONAL HIGHWAY DIVISIONS 11. Mis-use/mis-appropriation of NH funds ( Rs.323.37 lacs). As per Universal Cardinal and Principles of accounting and financial regularities, no expenditure should be incurred on any new item of work without prior approval of the competent authority. Any transaction against proper sanction tantamount to misappropriation of funds merely to utilize unspent budget provision. A review of reports for 1998-99 reveals that NH Division are incurring expenditure from NH funds on Civil Works of States such as construction of quarters, boundary walls go-down, sheds etc. or the funds are transferred to Deposits/MPWA and kept accumulated therefor years together which is not in order/against the normal financial procedure and norms.
12. Irregular/Excess purchases of material – Loss to MOST (Rs.36.48 lakhs). As per accounting system of PWD, it is desirable to retain the supply of materials to contractors in the hands of the Govt., provided a clause to this effect has been inserted in the terms and conditions of Contract. Material issued to the Contractor under such clause should be intended for the use and consumption on the specific work. But there is inherent risk of their pilferage and misuse if the materials are issued in bulk to contractors in advance long before their actual requirements. As per Ministry of Surface Transport (Road Wing) instructions issued in 1984 under their letters No.NH/II/P/1684 dated 28.01.84 and No.RW/NH-III/P/8/81 dated 16.02.84, 9% agency charges are meant to cover the expenditure on salaries of supervisory staff, repair of jeeps, POL, purchase of stationary, payment of telephone bills and other office contingencies etc. During test check of the records of the NH Divisions, it is observed that an expenditure of Rs.52.78 lacs has been incurred on such items which is contrary to the provisions and orders of the MOST. In addition, it has also been brought to the notice that 9% agency charges were also levied on this inadmissible expenditure
14. Unauthorized financial Aid to Contractors, amounting to Rs.889.65 lacs. Time factor is the main essence of any agreement entered into by the Govt. and the Contractors for execution of any work and the job is required to be completed within the stipulated period as per conditions of contract. In case of default, if any, on the part of the Contractors, the executing authority is empowered to impose penalty or rescind the Contract at the risk and cost of the Contractor. The scrutiny of records of some units revealed that the works were not completed within stipulated period specified in the contract and even no extension of time to complete the work and keep the contract alive was granted. Thus non-recovery penalty, non-levy of compensation for delay in completion of work by the Contractor amounts to undue favour to Contractors. There are cases where no recovery is effected on account of material issued departmentally and empties thereof not returned, 5% recovery on account of voids was also not made. All these instances tantamount to indirect undue financial benefits to the Contractors. Audit observed monetary loss to the MOST amounting to Rs. 889.65 lacs on this account during 1998- & Sirhind Canal.
15. Excess/Improper payment of Mobilisation Advance (Rs.564.80 lacs) As laid down in the rules, mobilisation advance, subject to a maximum limit of 10% of estimated cost, are sanctioned to the Contractors as advance on the security of machinery and plants brought to site for specialised and capital intensive works costing not less than Rs. Two Crores which is further subjected to 80% of the cost of machinery and plants brought to site. During test check of NH Divisions it is seen that these norms are not being followed strictly while issuing sanctions for grant of mobilisation advance. Instances have come to the notice of audit where mobilisation advance was given in excess of the admissible limits, interest thereon is not being charged as no clause for levy of interest has found to be incorporated in the contract. In few cases recovery on Mobilisation Advance is still pending although the work has finally been completed. Interest on Mobilisation Advance though recovered but taken as State receipts by the NH Divisions. As per Codal provisions laid down in the system of Public Works Accounts, no amount should be debited to "MPWA" for want of sanction or appropriation. Instead of effecting recovery, it is noticed that the dues have been debited to MPWA. An amount of Rs.1697.06 lacs against 13 paras have been reported outstanding under MPWA, and some of the items are pretty old.
17. Non-receipt of materials against Advance Payments (Rs. 241.25 lacs). As per procedure in vogue advance payments are made to oil companies for procurement of road materials like Bitumen, to state construction corporation Ltd. for construction of roads and bridges, to Railways authorities for Rail Over Bridge Works and to procure cement and steel. From the observations made during inspection of various NH Division it is seen that against such advances supplies are either not received or short supplies received from the concerned party, as a result balance amount of advance remain un-recovered/un-adjusted for years together.
18. Faulty financial and contractual Accounting worth Rs.10667.65 lacs. It is mandatory for the Contractor to execute the work as per the specification and the conditions of contract detailed in the schedule of work which specifications but the works are accepted by the Divisional Officers without accounting for the deviation. Payment on Hand Receipts, splitting up of jobs, wrong booking of expenditure incurred on repair of Central machines, rejection of lowest tender, enhancement of tender value without approval of MOST non-recovery of levied compensation are some of the reasons for faulty financial and contractual accounting resulting in financial loss to MOST.
19. Loss of Revenue and Mis-classification of Revenue Receipts (52 paras Rs.329.76 lacs) Govt. of India, Ministry of Surface Transport incurs expenditure on National Highway. Original Works, other schemes and to some extent expenditure on maintenance and repairs of National Highways are also incurred by MOST. As such all receipts realized regarding NH work (such as sale of tenders, road cut charges, value of empties, forfeited amount of lapsed deposits, rents from hotels, hire charges of machinery road side advertisements etc.) should either be taken as Central Govt. revenue under MH 1054 – Other Receipts or should be taken as reduction of cost of the work under 5054 – Capital outlay on NH (Dismantled materials and empty materials issued on works). During test-check of records of NH Divisions it is observed that a huge amount of revenues realized from the above-mentioned sources have either been credited to State Govt. under "MH 0059" or kept under "8443 – Civil Deposits". The amount was subsequently transferred to other state works at intermittent intervals.
20 Non-remittance of Toll Collection receipts (Rs.1688.53 lacs) As per notification dated 1992 of the Ministry of Surface Transport regarding fee for use of Permanent Bridges, the Divisional Officer shall remit all toll fee collection to the PAO(NH), H.Qs. through D.D. to enable him to credit the amount so received in relevant receipt head in his books. In turn the MOST sanctions/re-imburses 12% of the receipts so received as collection charges to the concerned state. But contrary to the provisions of the above-mentioned procedure, the NH Divisions are not remitting the toll collection in time. In some cases the Toll fee collected by the Division is not at all remitted to PAO(NH), MOST and misclassified as receipt under 8443 Civil Deposits which is subsequently transferred to State. As a result of test-check of Accounts of NH Division it is observed that an amount to the tune of Rs. 1688.53 lacs on account of toll fee collected has either been misclassified to Deposits or not remitted to PAO(NH), H.Qs.
21. Outstanding advance :- The units pertaining to LHLS ans Shipping are paying temporary advance to the concerned officer/staff to meet the day to day works expenditure. It was observed from the records of O/O Regional director, LHLS, Port Blair that 142 items for the total amount of Rs. 7,77,140/- pertaining to the period 1982 to 12/97 are still lying outstanding. In the O/O Regional Director, LHLS, Mumbai advance amounting to Rs. 1,96,395/- pertaining to the period from 1982-83 to 1997-98 is still lying outstanding. As per Revenue cash book of O/O Regional Director, LHLS, Calcutta, a sum of Rs. 9,83,999/- ( 279 items pertaining to the period 1991-92 to 1997 98) and as per capital cash book, temporary advance to the tune of Rs. 24,39,767/- (192 items pertaining to the period 1981-82 to 1997-98) are lying outstanding. It was observed that in the O/O Regional Director, LHLS, Chennai temporary advance amounting to Rs. 84,951/- given during 1995-96 to 97-98 ,is still outstanding. In the O/O Minor Ports Survey Organization, Mumbai advance to the tune of Rs.1,40,500/- given to various officials is lying outstanding. All advances are lying outstanding for want of adjustment bills from the officers to whom temporary advances were given. Immediate action is required to obtain the adjustment bills from the concerned officers for their adjustment.
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Last modified: September 12, 2000This page is designed and maintained by Dy.CA(A) O/O Chief Controller of Accounts. |