|Despite assurance given in 1995 to carry out trial evaluation of radars, Ministry failed to arrange the same and consequently two radars imported in August 1991 at a cost of Rs 4.56 crore were lying unutilised since their receipt.|
Mention was made in paragraph 17 of Report No.8 of 1995 of the Comptroller and Auditor General of India, Union Government- Defence Services (Army and Ordnance Factories) about import of two radars at a cost of Rs 4.56 crore and their non-utilisation since receipt in August 1991. The Ministry of Defence (Ministry) in their draft Action Taken Note of February 1995 stated that trials would be held as soon as foreign specialists arrive.
Further examination of the case revealed that these radars were released to a unit on loan for trials. The unit, however, pointed out in November 1995 that the radars were not issued to them because Central Ordnance Depot Agra did not provide qualified personnel for handing over of radars, during range test one radar was found in repairable condition and serviceability of seven equipments of both the radars could not be checked due to non-availability of qualified personnel. The user unit, therefore, requested Central Armoured Fighting Vehicles Depot, Kirkee to approach Army HQ/Central Ordnance Depot to provide qualified personnel for checking the serviceability of the equipments of radars and for handing over of radars. Central Ordnance Depot in December 1995 informed Army HQ that trained personnel were not available either with them or with any other unit and one of the radars lying in repairable condition could not be repaired. Depot also requested Army HQ to make available trained personnel so that receiving unit might be conversant with functioning of radar. After a lapse of about three years, Ministry in December 1998 signed a memorandum with firm ‘A’ for technical examination of the radars by deputing specialists in December 1998 itself. However, the specialists had not examined the radars and they were still lying unutilised.
Thus, despite being pointed out by audit in 1995, Ministry failed to arrange trial evaluation of imported radars costing Rs 4.56 crore and their suitability and serviceability was yet to be established. The radars were lying in Central Armoured Fighting Vehicles Depot without any use as of February 2000 since their receipt in August 1991.
The matter was referred to the Ministry in June 2000; their reply was awaited as of August 2000.
|Due to failure of Ministry in procuring Image Intensifier Tubes, 500 Night Vision Passive Devices alongwith modification kits valued at Rs 3 crore were lying in stock for the last six years.|
Ministry of Defence procured 500 sets of Periscope Armoured Vehicle Night Vision Devices alongwith modification kits without ensuring the availability of Image Intensifier Tubes (tubes) to be fitted therein. The entire quantity of 500 sets of devices and modification kits procured at Rs 3 crore were lying in stock of Central Ordnance Depot Agra for the last six years for want of tubes. Meanwhile, the warranty period of 12 months also lapsed.
Ministry placed an order on a firm in February 1988 for supply of 500 sets of Periscope Night Vision Device and modification kits to be used in a Tank at a total price of Rs 3.16 crore excluding the cost of Image Intensifier Tubes which were to be supplied by the Department of Defence Supplies free of cost for fitting in devices. The supply was to commence by May 1988 or earlier at 30 numbers per month and was to be completed by October 1989. The firm supplied part equipment viz. modification kits between February 1989 and November 1989.
In December 1993, after four years of receipt of modification kits, the Ministry issued an amendment to the order allowing the firm to despatch the devices without fitment of tubes by reducing the total price to Rs 3 crore. Accordingly, the firm supplied the devices without fitment of tubes during February/March 1994. Since then these 500 sets of devices and modification kits were lying in stock in incomplete status. The warranty period of 12 months also lapsed in the year 1995 itself.
Depot stated in June 1999 that the case was referred to Army HQ for their comments. However, the reply of Army HQ was awaited as of December 1999.
Thus, the failure of the Ministry to arrange procurement of tubes led to non-utilisation of devices procured at a total price of Rs 3 crore for the last six years. Besides, the warranty period also lapsed during stocking of stores in the Depot.
The matter was referred to the Ministry in July 2000; their reply was awaited as of October 2000.
|Cancellation of unauthorised works and revision of estimates at the instance of audit resulted in savings of Rs 1.52 crore|
Audit observations prevented unauthorised expenditure to the tune of Rs 1.52 crore in the following cases, by cancellation of irregular sanctions or reduction in scope of work.
A Corps HQ sanctioned in August 1995 the provision of street lights on central verge of widened civil road at a cost of Rs 35 lakh. The sanction catered for provision of street lights on civil road from defence fund which was irregular. After this was pointed out in Audit in June 1996, the Corps HQ cancelled the above sanction in August 1997 resulting in saving of Rs 35 lakh.
A Sub Area HQ accorded Admin approval in October 1997 for provision of mechanical laundry for 200 men at a training Command Camp at a station at an estimated cost of Rs 14.20 lakh. Since work was not authorised as per Scales of Accommodation 1983 it was pointed out in Audit that sanction of Government was needed for regularisation. Sub Area HQ, cancelled the work in December 1997 since the work had not commenced which has resulted in saving of Rs 14.20 lakh.
A Sub Area HQ sanctioned in June 1994 the work for provision of Other Ranks Institute for a transit Camp at an estimated cost of Rs 2.30 lakh to cater for strength of 17 men. Audit pointed out that in accordance with Scales of Accommodation 1983 no institute should be provided, if the strength of the unit was less than 40 men and the sanction issued was not in order. Sub Area HQ cancelled the sanction in September 1996 resulting in saving of Rs 2.30 lakh.
A Sub Area HQ accorded sanction in March 1998 for provision of Cook House and one toilet at a station at an estimated cost of Rs 9.98 lakh. The work was sanctioned in Permanent Specification for an Interim Location Plan unit. Audit pointed out that Key Location Plan of the special forces training though approved by Army HQ in July 1995 was yet to be approved by the Ministry of Defence and therefore the construction of accommodation for special forces training on permanent specifications was not in order. Sub Area HQ cancelled the work in May 1998 resulting in saving of Rs 9.98 lakh.
A Corps HQ accorded sanction in September 1998 for provision of transformer to Army School Complex Area at a station at an estimated cost of Rs 4.82 lakh. Audit pointed out that sanctioning the work for Army School not approved by Government out of defence funds was not in order. Corps HQ agreed with Audit view and cancelled the work in June 1999 resulting in saving of Rs 4.82 lakh.
Ministry of Defence sanctioned the work for location/functioning of a Squadron in August 1996 at an approximate cost of Rs 12.31 crore. The sanction catered for married accommodation/ single accommodation for 13 officers and 147 airmen/ Non-combatants. While working out the authorised plinth area for married accommodation 12˝ per cent excess was catered for 1˝ brick wall construction. Audit pointed out that a similar work for provision of married accommodation for Officers, Airmen and Non-Combatant Enrolled sanctioned by Ministry in March 1999 for another similar Squadron at the same station revealed that no extra plinth area for 1˝ brick wall had been catered for. Therefore, the provision of extra plinth area of 12˝ per cent and 1˝ brick wall for the single and married accommodation for the Squadron was not in order and the estimates required revision. Commander Works Engineer agreed with Audit contention in June 1998 and initiated reduction statement for Rs 67.70 lakh.
An Air Force Station accorded sanction in November 1995 for air- conditioning of station briefing hall in Air Traffic Control Buildings at an estimated cost of Rs 3.44 lakh under para 53 of the Scales of Accommodation 1983. But para 53.5(c)(iii) stipulates that air-conditioning can be provided only to Air Traffic Control whereas air-conditioning was for briefing halls/conference halls. On being pointed out by Audit the Air Force Station cancelled the subject work in June 2000 resulting in saving of Rs 3.44 lakh.
Commandant of an Air Force Academy sanctioned in August 1999 construction /extension of CSD Canteen building at a cost of Rs 8.16 lakh. As CSD Canteen is a regimental activity, sanctioning of the work was objected to in Audit. The sanction was cancelled at the instance of Audit, resulting in a saving of Rs 8.16 lakh.
Based on the recommendations of a Board of Officers to replace existing fluorescent tube lights with HPSV (High Pressure Sodium Vapour Lights) lamps for providing better illumination on the roads, an Infantry Division sanctioned works services in October 1999 for replacement of 131 tube lights with HPSV lamps at a cost of Rs 6.65 lakh. When Audit enquired into the necessity for replacement of the entire 131 fluorescent tube lights rather than providing additional lights, Infantry Division cancelled the sanction in April 2000 resulting in a saving of Rs 6.65 lakh.
Ministry accepted the facts in December 2000.
|Operation of three local posts in the Military wing of the Mission in Paris without the sanction of the competent authority resulted in unauthorised expenditure of Rs 1.25 crore.|
As per the General Financial Rules, no authority can incur expenditure or enter into any liability involving expenditure from Government account unless such expenditure has been sanctioned by general or special orders of Government or by any authority to which power has been delegated on its behalf. In case of salary, no expenditure can be incurred without specific sanction, creating the post, by competent authority.
Ministry revived the Military wing in the Embassy of India, Paris (Mission) in March 1995, which was earlier closed with effect from 01 June 1993. While reviving the Military wing, the Ministry sanctioned continuance of only three India based posts, viz., one each of Brigadier as Military Attache, Junior Commissioned Officer as clerk and Havildar as Personal Assistant. One each of India based posts of Havildar Clerk, Orderly and Batman, which were in existence prior to closure of the Military wing in June 1993, were not revived in the sanction issued in March 1995.
The powers to sanction regular posts of local employees in the Missions abroad rests with Government, and the Missions have not been delegated powers to create and operate such posts. Despite this, the Mission at Paris operated three local posts in the Military wing since 01 June 1993, consisting of two Junior Translators and one Messenger, without sanction of the Ministry to their creation.
The Mission had spent FFr 1.942 million equivalent to Rs 1.25 crore (at the official rate of exchange of September 2000 of Re 1= FFr 0.156) on pay and allowances and social service contributions of the three employees during June 1993 to October 2000, which is entirely unauthorised. The unauthorised employment against three local posts was continuing as of November 2000.
While the Mission acted in disregard of the limitations on their delegated powers, the Ministry also failed to notice the infringement of the limit on delegated powers of the Mission and continued to endorse the accounts of the Mission, which included expenditure on local posts. It is noteworthy that the budget proposals of the Mission specifically indicated provisions for local posts during all the years in question.
Ministry sought to justify in September 2000 the unauthorised action by the Mission on the specious technical ground that the Ministry’s orders holding the India-based posts in the Mission in abeyance were silent about the local posts. Ministry’s attempt to contest the audit observation by contending that the local posts were never abolished is not tenable since with the closure of the Military wing, the question of operation of any posts - local or India-based did not arise.
It is recommended that Ministry should take immediate remedial measures for discontinuance of the unauthorised appointment of local employees and investigate the matter to fix responsibility on the authority which acted beyond the delegated powers, leading to such heavy unauthorised expenditure. Ministry should also introduce measures to strengthen the internal control system in relation to their approval of the budget estimates requested by their field units, particularly by the Missions abroad.
|Sanction of Officers married quarters based on a model PE resulted in construction of excess quarters leading to re-appropriation of some quarters for unauthorized purposes and some other remaining vacant.|
A Board of Officers assembled in September 1984 assessed the works services required for Naval Air Station Arkonam based on a model PE (Peace Establishment) of a existing similar unit, as the PE of the Naval Air Station was not sanctioned by the Government at that stage. Based on the recommendations of the Board, Ministry sanctioned in July 1987 construction of 145 quarters for married personnel including 81 for officers of the rank of Lieutenant and below. Ministry priorotised in October 1987 the sanctioned items of work to be constructed on time bound basis, in which only 50 per cent of the married accommodation were included.
The Project Management Board in a meeting chaired by Additional Secretary (Defence) held in February 1988, however, decided construction of married quarters at 100 per cent to avoid possible cost escalation in future. Government sanctioned between March 1991 and February 1992, the manpower for Naval Air Station comprising of 150 officers. According to the sanction, 58 quarters were required to be constructed for married officers of the rank of Lieutenants and below. However, by then Chief Engineer Madras Zone had constructed 72 quarters for Lieutenants and below. Thus 14 quarters were constructed in excess at a cost of Rs 30.78 lakh. Further, only 54 officers of the rank of Lieutenant and below were posted to the Naval Air Station as of February 1999 and only 49 as of October 2000.
Audit scrutiny of the occupation of above 72 quarters showed that as of October 2000 only 51 per cent quarters were occupied by entitled officers and five were lying vacant. Others had been over the years, either used for unauthorized purposes like transit accommodation, Naval Wives Welfare Association, Play school, ward rooms for officers mess etc. or remained vacant.
The matter was referred to the Ministry in August 2000; their reply was awaited as of October 2000.
|Lack of coordination between two sections of Ministry of Defence coupled with failure to follow the recommendations of Expert Committee resulted in unnecessary procurement of entertainment films worth Rs 33.08 lakh.|
Mobile Cinema Sections had been functioning in the Army as part of the Ordnance establishments for providing entertainment to troops deployed in operational/forward areas under field conditions. With the advent of new technology in the form of Television/VCRs, an Expert Committee recommended disbandment of mobile cinema section in 1992.
Army Headquarters in January 1994 circulated the minutes of meeting of the Army Standing Establishment Committee held between November 1993 and January 1994 to the Ministry of Defence (Finance) amongst others. It recommended reduction of nine personnel from Peace Establishment of Central Ordnance Depot Bombay, which was the stocking Depot for entertainment films and discontinuance of procurement of entertainment films during the gestation period. The Steering Committee on implementation of the Expert Committee recommendations also directed in March 1994 disbandment of mobile cinema sections.
Ministry accorded sanction for disbandment of seven sections in March 1994. Subsequently in September 1994 Ministry accorded one more sanction for disbandment of 21 sections by May 1995.
Notwithstanding the above, a Board of Officers comprising Assistant Financial Advisor, Ministry of Defence (Finance), Army HQ and Central Ordnance Depot Bombay assembled at the Depot on 08 September 1994 and selected entertainment films for screening in mobile cinema sections which were under orders of disbandment. However, the Board in their deliberation nowhere discussed the issue of disbandment.
Based on the recommendations of this Board, Ministry in January 1995 as amended in December 1995 accorded sanction for procurement of entertainment films at Rs 35.77 lakh in total disregard of ongoing process of disbandment of mobile cinema sections. Central Ordnance Depot Bombay placed two supply orders in March 1995 on Cine Films distributors, Bombay for 16 films, three copies each. These films were received in March 1995. Audit scrutiny of log books of films at Central Ordnance Depot Bombay revealed that 29 copies of 15 films worth Rs 20.15 lakh have never been screened.
Thus, lack of coordination between two sections of Ministry i.e. one which decided disbandment of mobile cinema sections and another which sanctioned procurement of films led to unnecessary procurement of entertainment films worth Rs 33.08 lakh. The fact that films procured in the form of raw material are used immediately and never carried forward in the next financial year was also known to the Ministry. The disposal action for entertainment films was yet to be taken by Depot as of June 1999.
The matter was referred to the Ministry in August 2000, their reply was awaited as of October 2000.
|Laxity of Military Attache and Army HQ in timely processing of discrepancy reports for defective supply of Aerial Target Aircraft Drone by foreign supplier resulted in loss of Rs 16.34 lakh.|
Ministry of Defence entered into a contract in April 1993 with a foreign firm for supply of “Aerial Target Aircraft Drone” along with spares and accessories. Commandant, Central Ordnance Depot, Agra noticed deficiencies in two consignments and addressed Discrepancy Reports to Military Attache on 26 October 1994 in respect of the first consignment and on 31 July 1995 in respect of the second consignment. These Discrepancy Reports were addressed to the Military Attache in the Embassy of India, abroad, Ministry of External Affairs and the Army HQ. The value of deficiency was $10,874.69 in the first consignment and $40,861.66 in the second consignment. However, the Military Attache forwarded copies of the two discrepancy reports to the supplier asking for free replacements or to rectify the defects in-situ to make good the deficiency only in May 1998. This was followed up with a reminder faxed on 27 July 1998. In response, the firm in their fax dated 03 August 1998, offered to repair the defects and replace material in disrepair and asked the Military Attache to advise details. In reply, the two discrepancy reports containing details of deficiencies/defects were again sent to the Supplier on 25 September 1998. The Supplier, in their response dated 02 November 1998, raised the following issues:
This situation could have been averted had the Army HQ taken up the discrepancy reports with the supplier or had the Military Attache not waited till May 1998 to take up the matter with the supplier and had acted upon the repeated reminders on the matter from Central Ordnance Depot.
These lapses on the part of the Army HQ and the Military Attache’s office resulted in a loss of $51,736.35 (Rs 16.34 lakh) (One US Dollar = Rs 31.59) ; being the cost of items deficient or in disrepair to the Government of India, as the supplier has rejected claims on grounds of expiry of warranty period and other reasons. Besides, in the absence of these items, the army had to resort to cannibalization to keep the received items in a state of use.
The matter was referred to the Ministry in October 2000; their reply was awaited as of January 2001.
On the recommendations of the Public Accounts Committee, Ministry of Finance (Department of Expenditure) issued directions to all ministries in June 1960 to send their response to the Draft Audit Paragraphs proposed for inclusion in the Report of the Comptroller and Auditor General of India within six weeks.
The Draft Paragraphs are always forwarded by the respective Audit Offices to the Secretaries of the concerned ministries/departments through Demi Official letters drawing their attention to the audit findings and requesting them to send their response within six weeks. It was brought to their personal notice that since the issues were likely to be included in the Audit Report of the Comptroller and Auditor General of India, which are placed before Parliament, it would be desirable to include their comments in the matter.
Draft paragraphs proposed for inclusion in the Report of the Comptroller and Auditor General of India for the year ended March 2000 : Union Government (Defence Services), Army and Ordnance Factories : No. 7 of 2001 were forwarded to the Secretary, Ministry of Defence between June 2000 and November 2000 through Demi Official letters.
The Secretary of the Ministry of Defence did not send replies to 25 Draft Paragraphs out of 45 Paragraphs in compliance to above instructions of the Ministry of Finance issued at the instance of the Public Accounts Committee. Thus, the response of the Secretary of the Ministry could not be included in them.
Total No. of Paragraphs on Ministry/ Department included in Audit Report
No. of Paragraphs on which reply not received from Secretary
Ministry of Defence
25 (excluding Paragraph 1 to 13 of Chapter I and Paragraph No.21)
14, 15, 18, 19, 20, 22, 23, 24, 26, 27, 28, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39, 40, 43,44 and 45
|Despite repeated instructions/recommendations of the Public Accounts Committee, the Ministry did not submit remedial Action Taken Notes on 184 Audit Paragraphs.|
With a view to ensuring enforcement of accountability of the executive in respect of all issues dealt with in various Audit Reports, the Public Accounts Committee desired that ATNs (Action Taken Notes) on all paragraphs pertaining to the Audit Reports for the year ended 31 March 1996 onwards be submitted to them duly vetted by Audit within 4 months from the laying of the Reports in Parliament. Meetings were also held in August 1998, December 1998 and September 1999 under the Chairmanship of Secretary (Expenditure) to ensure timely submission of ATNs and to review the position of pending ATNs. Ministry of Finance (Department of Expenditure) in July 2000 reiterated instructions issued by Public Accounts Committee to take urgent steps to finalise all the pending ATNs even of earlier Reports to ensure that all vetted ATNs are sent to Monitoring Cell well before the deadline prescribed by the Committee.
Review of outstanding Action Taken Notes relating to Army as of 16 November 2000 revealed that the Ministry failed to submit ATNs in respect of 184 Paragraphs included in Audit Reports up to and for the year ended March 1999 (No.7 of 2000) as per Annexure-I. Of these, even first round of ATNs for 37 (one paragraph pertained to Report No.8 of 1992) paragraphs were not received for vetting and 36 paragraphs pertained to the Audit Reports up to and for the year ended March 1993 (No.8 of 1994).
The matter was referred to Ministry in September 2000; their reply was awaited as of 16 November 2000.