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Compliance
Commercial

Report No. 3 of 2011 - Compliance Audit on Observations of Union Government (Commercial)

Date on which Report Tabled:
Thu 25 Aug, 2011
Date of sending the report to Government
Government Type
Union
Union Department
Commercial
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Sector Finance,Transport & Infrastructure,Power & Energy,Industry and Commerce,Information and Communication,Social Welfare

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 to shift to system based quality audit reporting using risk based audit approach. The Report contains 34 theme based audit/IT audits and 37 individual observations relating to 50 PSUs under 17 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 51 observations were not received even as this report was being finalised in March 2011. Earlier, the draft observations were sent to the Managements of the PSUs concerned. In respect of six paragraphs, the Managements did not respond.

The Ministry of Petroleum & Natural Gas restricted use of APM gas only for fertilizer and for power generating companies supplying electricity to the grid for distribution to the consumers through public utilities/licensed distribution companies.Accordingly, the Ministry revised the rates for APM gas supplied to consumers other than power and fertilizer sector consumer from Rs.3200 to Rs.3840 per Metric Standard Cubic Meter. GAIL (India) Limited continued to supply the gas at pre revised rates of Rs.3200 to consumers generating electricity and supplying to their consumers at commercially agreed rates through wheeling arrangement with the state electricity board.Thus, GAIL extended benefit to private parties taking shelter under the argument that the matter stood referred to the Ministry for clarification and leaving the matter unresolved for an indefinite period. This resulted in loss of revenue of Rs.227.37 crore during April 2006 to March 2010.

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