Audit Reports

Jharkhand

Overview

The Audit Report of the Comptroller and Auditor General of India on General, Social, Economic and Revenue Sectors including PSUs, Government of Jharkhand for the year ended 31 March 2019 was presented to the State Legislature on 8 September 2021.

GENERAL, SOCIAL AND ECONOMIC SECTORS

Audit of Implementation of Mukhya Mantri Gram Setu Yojana in Jharkhand

The Department neither framed any operational guidelines nor conducted any survey to assess the un-bridged gaps in rural roads requiring construction of a bridge. Though the Department issued instructions through circulars/letters to manage the scheme and had a District Rural Road Plan (DRRP) under Pradhan Mantri Gram Sadak Yojana (PMGSY) with information on gaps in rural road network, these were not adhered to.

The bridges under the scheme were selected on the recommendations of MPs/MLAs/others without examining their feasibility or factoring in the un-bridged gaps in DRRP. Resultantly, bridges were constructed outside the realm of DRRP, at places having pre-existing bridges constructed under different schemes within one KM connecting same/nearby habitats and in municipal areas.  

Of the 208 incomplete bridge works in the State as on March 2019, 39 bridges could not be completed despite their completion periods by over six months to nine years and six months.

The Department did not have any operational guidelines for engagement of consultants for preparation of Draft Project Reports (DPRs). Resultantly, undue benefits were extended to the empanelled consultants by keeping their period of engagement open ended leaving no scope for entry of new consultants and absence of penalty clause, performance review of consultants based on assessment criteria, review of DPRs of consultants by independent agencies etc.

The consultants did not conduct the required geo-technical investigations, hydrological and traffic data analysis. As a result, eight bridges constructed at a cost of ₹ 52.12 crore out of 42 test-checked bridge works got fully or partly damaged subsequently.

In designing approach roads, the consultants provided sharp curves (up to 90 degree) at the entry/exit point of 16 bridges and shortened the width (3.75 metres to 4.1 metres) of approaches in comparison to width of bridges (7.5 metre) in 28 bridge works. The consultants had also added extra provision of five per cent for laps and wastage of steel valued at ₹ 2.41 crore in 33 sampled bridge works.

The tender and agreement documents were loaded in favour of contractors such as reduction in defect liability period of bridges etc.

No responsibility was fixed for execution of sub-standard works valued at ₹ 52.07 crore in six bridges.

In the absence of periodic maintenance of completed bridges, scouring in bridge foundations, wear and tear in expansion joints and wearing coats, cracks in RCC works and damages in elastomeric bearing, damages to railings, footpaths, approach roads and flanks etc., were noticed during joint physical verification.

Award of work on the strength of fake bank guarantees and power of attorney suspected to be fake led to fraudulent payment and loss of Government money of ₹ 13.24 crore.

Injudicious sanction of widening and strengthening work of a portion of HKC road by Road Construction Department concurrently with the preparation of DPR of the same road led to avoidable expenditure of ₹ 5.03 crore on overlaying the bituminous works afresh.

Failure of the Welfare Department to monitor the activities of District Welfare Office (DWO), Chatra and enforce internal control measures led to embezzlement of ₹ 13.59 crore by the District Welfare Officer, Chatra in connivance with the cashier.

Failure of the Department to ensure water and electric supply besides operational cost for operation of two nurseries even after more than four years of their construction led to unfruitful expenditure of ₹ 2.78 crore.

The Department failed to release funds to operationalise the Pig Breeding Nucleus (PBN) unit, establish Satellite Field Breeding units and implement the Pig Development Scheme despite a lapse of more than seven years since commencement. The pig sheds of the PBN unit constructed at a cost of ₹ 1.59 crore were lying idle since December 2014.

The Executive Engineer, Minor Irrigation Division, Giridih commenced work on the Charki Pahari Medium Irrigation Scheme without completing the process of land acquisition leading to idle expenditure of ₹ 1.30 crore and blocking of ₹ 3.93 crore.

REVENUE SECTOR

Delayed mapping of provisions as well as incorrect mapping in the application software resulted in short levy of one-time tax of ₹ 5.54 crore from 2,633 vehicles and excess levy of ₹ 59.32 lakh from 189 vehicles.

The amended provisions were mapped in the application software with a delay of five days which resulted in short levy of temporary tax of ₹ 8.68 lakh from 434 vehicles.

Non-revision of axle weight of 15,507 transport vehicles resulted in non-assessment of tax of ₹ 6.95 crore.

The DTOs irregularly endorsed hire purchase/hypothecation agreement in certificate of registration in favour of financers who had not obtained trade certificates.

Absence of check mechanism to detect expiry of fitness certificate resulted in non-assessment of fee and fine of ₹ 22.82 crore from 6,498 transport vehicles due to non-renewal of certificate of fitness.

Certificate of registration of personalised vehicles were not renewed after expiry of their validity resulting in non-assessment of ₹ 2.94 crore on 829 vehicles.

In the absence of mechanism for inter-departmental exchange of data/information, 174 common carriers remained unregistered resulting in non-levy of fee of ₹ 33.06 lakh.

Tax and penalty of ₹ 74.57 crore from 9,260 transport vehicles realisable from defaulting vehicle owners was not collected by the DTOs.

One-time tax and penalty of ₹ 44.37 crore from 30,262 vehicles brought under the purview of one-time tax was not collected by the DTOs.

Subsequent authorisation during currency of national permits of transport vehicles was not done which resulted in non-realisation of consolidated fee and authorisation fee of ₹ 6.73 crore from 1,515 national permit holders.

In the absence of mechanism for monitoring of defaulting vehicles plying under reciprocal agreements, tax and penalty of ₹ 1.66 crore from 108 vehicles was not collected.

Service tax/ GST of ₹ 7.59 crore collected along with issue/ renewal of fitness fee was not deposited in the appropriate head of account.

In the absence of mechanism to obtain data/information from licensees, the CTD failed to identify 550 unregistered bulk consumers. This resulted in non-levy of electricity duty of ₹ 16.57 crore and penalty of ₹ 22.40 crore.

Absence of mechanism to verify returns with information on actual consumption resulted in concealment of electrical energy of 482.31 crore units and consequent short levy of electricity duty of ₹ 24.85 crore and penalty of ₹ 28.87 crore.

Absence of mechanism to verify returns with information on transfer of energy between licensees resulted in allowance of excess exemption of 1,005.51 crore units and consequent short levy of electricity duty of ₹ 270.99 crore including penalty of ₹ 120.16 crore.

The Assessing Authorities while finalising the assessments did not verify the returns with the documents available on record which led to under assessment of electricity duty and penalty of ₹ 640.12 crore.

The Assessing Authorities while finalising the assessments did not verify the rates of electricity duty from the schedule of rates resulting in short levy of electricity duty of ₹ 316.79 crore including penalty.

Other observations

Commercial Taxes Department

The Assessing Authorities, while finalising the assessments, did not cross-verify returns with the utilisation of Form C, F and other records which led to under assessment of tax and penalty of ₹ 25.99 crore.

The Assessing Authority disallowed unascertainable claims of labour and other like charges but levied tax at the rate of five per cent instead of leviable 14 per cent of the taxable turnover arrived thereafter resulting in short levy of tax of ₹ 4.39 crore.

The Assessing Authority disallowed adjustment of Input Tax Credit of ₹ 5.51 crore. However, interest of ₹ 3.97 crore was not levied on disallowed Input Tax Credit.

Excise and Prohibition Department

The Department did not take action to ensure lifting of minimum guaranteed quota which resulted in short lifting of liquor by 496 vendors between April 2016 and July 2017 in four excise districts and non-levy of penalty equivalent to loss of excise duty of ₹ 22.46 crore.

PUBLIC SECTOR UNDERTAKINGS

Performance of Power Sector PSUs

The overall loss incurred by these five power sector PSUs were ₹ 479.44 crore in 2018‑19 against loss of ₹ 1,518.39 crore incurred in 2014-15. According to the accounts of the power sector PSUs for the year 2018-19, one PSUs earned profit of ₹ 92.57 crore and four PSUs incurred loss of ₹ 572.01 crore and three non-working PSUs had not yet started operation/commercial production. The top profit making company was Tenughat Vidhyut Nigam Limited (₹ 92.57 crore), while Jharkhand Urja Sancharan Nigam Limited ₹ 358.27 and Jharkhand Bijli Vitran Nigam Limited incurred substantial loss of ₹ 212.17 crore.

At the aggregate level, the accumulated losses of the five power sector PSUs was ₹ 6,744.16 crore as against the capital investment of ₹ 4,235.32 crore as on 31 March 2019. Of the five working Power Sector PSUs, net worth of Jharkhand Bijli Vitran Nigam Limited (₹ 1,918.33 crore) and Tenughat Vidyut Nigam Limited (₹ 1,013.63 crore) had fully eroded.

Quality of accounts

The quality of accounts of power sector PSUs needs improvement. Nine audited accounts for the years 2011-12 and 2017-18 relating to four PSUs were finalised during 01 May 2018 to 31 December 2019. The Statutory Auditors had issued certifications with qualifications for seven accounts, Adverse for one accounts & Disclaimer for one accounts. Compliance to the Accounting Standards by the PSUs remained poor as the Statutory Auditors pointed out three instances of non-compliance to the Indian Accounting Standards in two accounts of two PSUs.

Performance of State PSUs (Non-Power Sector)

Out of 16 working State PSUs, 9 PSUs earned profit of ₹ 37.25 crore and 7 PSUs incurred losses of ₹ 11.62 crore. Seven non-power sector companies had not yet submitted their first account. The top profit making companies were Jharkhand State Beverage Corporation Ltd. (₹ 11.95 crore), Jharkhand State Forest Development Corporation Ltd (₹ 5.90 crore) and Greater Ranchi Development Agency (₹ 8.86 crore) while, Jharkhand Silk Textile &Handicraft Development Corporation Ltd (₹ 4.62 crore) and Jharkhand Hill Area Lift Irrigation Corporation Limited (₹ 3.65 crore) incurred losses.

Quality of accounts

The quality of accounts of PSUs needs improvement. Out of 10 accounts forwarded to the Accountant General during 01 January 2019 to 31 December 2019, the Statutory Auditors issued certification with qualifications in respect of 8 accounts and disclaimer in two accounts. There were 5 instances of non-compliance with Accounting Standards in three accounts.

Audit on Management of Assets by Jharkhand Tourism Development Corporation Limited.

Master plan for integrated development and marketing of tourism was not prepared, minimum standards for tourism units was not set up as envisaged in the Jharkhand Tourism Policy 2015 even after a lapse of more than four years after it was introduced.

Thirty nine assets constructed (between 2004 and 2018) at a cost of ₹ 39.62 crore remained non-operational or partially operational.

Bed occupancy remained low due to remoteness of location, poor management and lack of basic amenities/facilities.

The Company failed to enforce the terms and conditions of the agreements due to which undue benefits accrued to developers.

Lack of monitoring led to irregular commercialisation of assets, failure to insure assets, illegal operation of assets by locals, encroachment etc.

Due to poor financial management, JTDC could neither utilise the funds provided by the Department for advertisements/incentives nor realise the outstanding rent/license fee/damage charges.

Jharkhand Urja Sancharan Nigam Limited failed to fully implement the provisions of the Building and Other Construction Worker’s Welfare Cess Act, 1996 which led to short deduction of labour cess of ₹ 17.89 crore.

Failure to recover fees and charges for State Load Despatch Centre operation from users by Jharkhand Urja Sancharan Nigam Limited led to loss of ₹ 12.18 crore.

Download Audit Report

• Report No. 1 of 2021 - General, Social, Economic and Revenue Sectors including PSUs, Government of Jharkhand for the year ended 31 March 2019
  _{(6.56 MB) Download}

• Cover Page
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• Table of Contents
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• Preface
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• Overview
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• Section A - General, Social and Economic Sectors
  _{(4.20 MB) Download}
• Section B - Revenue Sector
  _{(0.57 MB) Download}
• Section C - Public Sector Undertakings
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• Appendices
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• Excerpts from Chapter 2: Para 2.1 Implementation of Mukhya Mantri Gram Setu Yojana in Jharkhand
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