CAG pulls up CWC for incurring avoidable expenses of Rs 8.65 crore

Government auditor CAG on Tuesday pulled up the Central Warehousing Corporation (CWC) for incurring an avoidable expenditure of Rs 8.65 crore on account of improper planning in the acquisition of land, delay in the surrender of surplus land and payment charges.

The Comptroller Auditor General of India (CAG) also said there were pending cases of execution of lease/title deeds in favour of CWC. Land acquired long ago (five years or more) was lying unutilised defeating the purpose of acquisition and resulted in blockage of funds.

In addition, CWC neither disposed-off flats lying vacant for considerable time nor could utilise them alternatively, it said the report (for the years ended March 2020 and 2021) tabled in Parliament.

According to the CAG, about 42 cases were pending for registration of title/lease deed in favour of CWC, since acquisition during 1964 to 2012. Maximum pendency of 66.66 per cent of non-execution of deeds was due to disputes with various government authorities/departments.

As on March 31, 2021, CWC had 3578.50 acre of land at 416 locations. It had vacant land measuring 794.78 acres in 103 locations worth Rs 90 crore adjacent to existing godowns in 14 Regional Offices (ROs). These vacant lands had a potential to augment capacity of 17.30 lakh tonne, it said.

It was observed that land measuring 721.46 acres in 95 locations were acquired long ago (i.e. five years or more) but were not fully utilised and parts of land were remained vacant as on March 31, 2021.

In four cases, where possession of 21.67 acres land was taken between 1993 and 2009, no capacity was constructed and entire land remained unutilised. This indicates acquisition of land without conducting any proper assessment/planning on requirement of godowns, the CAG added.

That apart, Assam government had allotted land to CWC (March 2003) near Lokpriya Gopinath Bordoloi International Airport, Guwahati (LGBIA) for development of an Agri-cum-Air Cargo Complex (AACC). CWC paid an amount of Rs 5.79 lakh to state government towards cost of land and took possession of land in March 2006.

It was noticed that after a delay of more than five years from date of possession of land, RO Guwahati approached in August 2011 the North Eastern Council (NEC) for funding of the entire project.

In response, NEC stated in September 2011 that the CWC’s request was devoid of any project proposal and requested them to submit a Detailed Project Report (DPR) along with concept paper for its consideration.

“CWC failed to submit DPR to NEC since August 2011. The DPR was yet to be submitted to NEC (March 2021). This resulted in loss of business opportunities of Rs 73 lakh per year besides blockage of funds of Rs 5.79 lakh paid as cost of land in February 2004,” the CAG said.

The Kolkata office of CWC had a land of 40,468.55 square meter in Haldia, where a covered warehouse of 32,400 tonne capacity was in operation. It acquired (May 1988) another plot of land of 13,597.5 square meter adjacent to the existing land on 30 years lease from Kolkata Port Trust (KoPT) for future expansion of business by laying rail lines on it to make CW Durgachak a rail-fed warehouse. The lease rental for additional land taken in 1988, was Rs 85,446 per month.

“During scrutiny of records, it was noticed that the additional land acquired in 1988 was lying unutilised since acquisition,” the CAG added.

The CAG recommended the CWC to frame time bound plan for utilisation of land remaining vacant for a long period (five years or more) and undertake cost benefit analysis before acquisition of land for godown/warehouse.

Besides, the CWC should make efforts to either dispose-off or identifying any alternative use for the residential flats lying vacant for a long time at Bhopal and Mumbai, it added.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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