CAG indicts SIDCUL for extending 'undue' benefits

The State Industrial Development Corporation of Uttarakhand Limited (SIDCUL), which came under the scanner for alleged scandals last year, is again in the news for the wrong reasons.

The comptroller and auditor general (CAG), in its latest report, has rebuked SIDCUL, the government's nodal agency to carry out industrialisation in the state, for extending "undue benefits" to three private firms and thus suffering losses of Rs 3.52 crore.

In the first case, the CAG found that SIDCUL suffered a loss of Rs 2.76 crore by accepting bids at higher rates from Gangotri Enterprises "" a private company "" than the rates quoted for identical infrastructure works which was to be executed at its Integrated Industrial Estate (IIE), Pantnagar, in the Kumaon region.

The CAG observed that Gangotri Enterprises quoted the same rates of 22.57 crore for all the three packages, bids for which were invited to be executed at Pantnagar.

The first two packages were awarded at the rate of Rs 19.81 crore each to Chandirgarh-based SAB Industries Limited, which was Rs 2.76 crore less that the rate of the Gangotri Enterprises.

Though there was a clause that no bidder will be allotted more than two packages, Gangotri Enterprises was awarded the third package.

The CAG also observed that in such a situation it would have been prudent for SIDUCL to negotiate with Gangotri Enterprises to bring down the rate, or cancel the tender in its own interest. Since the works for all the three packages were identical, the company lost Rs 2.76 crore.

In another instance, SIDCUL granted the status of a mega project to Neel Metal Products Limited (NMPL), an ancillary of auto major M&M, in violation of its norms and guidelines and thus extended undue benefits of Rs 4,06,000 to it, the CAG said.

The mega status to NMPL was granted on the ground that it entered into a joint venture with M&M by merely "constructing a common boundary wall". "The Joint venture was clearly made only to avail the waiver of local premium," the CAG said.

In yet another case, SIDCUL allotted land at lower rates to Ranbaxy Fine Chemicals Limited (RFCL) without obtaining competitive bids and thus extended undue benefit to the tune of Rs 3,16,500 to it, the CAG report said.