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Compliance
Commercial

Report No. 8 of 2012 - Compliance Audit on Observations of Union Government, Commercial

Date on which Report Tabled:
Tue 04 Sep, 2012
Date of sending the report to Government
Government Type
Union
Union Department
Commercial
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Sector Finance

Overview

This Report includes important audit findings noticed as a result of test check of accounts and records of Central Government Companies and Corporations conducted by the officers of the Comptroller and Auditor General of India under Section 619(3) (b) of the Companies Act, 1956 or the statutes governing the particular Corporations.

The concept of thematic study was introduced during the year 2008-09 to shift to system based quality audit reporting using risk based audit approach. The Report contains 15 theme based audit observations and 49 individual audit observations relating to 44 PSUs under 16 Ministries/Departments. The draft observations were forwarded to the Secretaries of the concerned Ministries/Departments under whose administrative control the PSUs are working, to give them an opportunity to furnish their replies/comments in each case within a period of six weeks. Replies to 34 observations were not received even as this report was being finalised. Earlier, the draft observations were sent to the Management of the PSUs concerned and their replies were considered while finalising this report.

The Cabinet Committee on Economic Affairs (CCEA) while granting approval in December 2000, to provide four lane connectivity to the major ports in the country on BOT basis through SPVs, had directed National Highways Authority of India to award contracts for Port Road Connectivity (PRC) projects by March 2002. Accordingly, these projects were expected to be completed within a period of 2-3 years of award of contract.NHAI/SPVs, however, did not prepare Corporate/ Strategic Plan for timely implementation of these projects. Delay in formation of SPVs and award of contracts was observed in various projects. Resultantly, none of the projects was completed by the scheduled completion date. Out of total nine projects, only four were completed so far with delays ranging from 12 months (JNPT Phase-I) to 53 months (Cochin) and remaining five projects were yet to be completed (December 2011). At Mormugao and Cochin ports, a road stretch of 1.8 kms and 10 kms, respectively, at the port end could not be upgraded due to non incorporation of these stretches in respective DPRs. Thus upgraded road connectivity to Mormugao and Cochin Ports could not be established.Further, due to ineffective toll collection operations of SPVs, toll collection was either delayed or suspended and SPVs sustained revenue loss of Rs.127.68 crore. Potential loss of toll revenue, due to delay in completion of PRC projects, worked out to Rs.873.85 crore(December 2011).

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