CBI inducts two local cops to investigate IFFI scam

The Central Bureau of Investigation (CBI) has inducted two police officials from the Goa police force to probe into alleged irregularities committed by the the BJP-led government during the international film festival.

Sources in the CBI informed Business Standard that the Goa government has submitted the report prepared by CAG pertaining to the financial lapses in the matter of expenditure on the facilities and infrastructure development in 2004.

"We have inducted two senior police officers to carry out thorough investigations into the financial irregularities," a senior CBI officer said. The Congress-led Pratapsingh Rane government had handed the investigations to CBI.

In its report for the year ended March 31, 2005, CAG has pulled up former CM Manohar Parrikar for irregularities in IFFI 2004. Parrikkar was then heading the Goa State Infrastructure Development Corporation (GSIDC), the nodal agency for carrying out IFFI-related works.

The GSIDC spent Rs 75.76 crore (till June 2005) on these projects, in addition to additional liabilities of Rs 21.21 crore.

According to the CAG report, Inox Leisure Limited had originally quoted Rs 21.23 crore (Rs 19.13 crore for the multiplex with six screens and 1,250 seats and Rs 2.10 crore for renovation of the existing buildings in the complex). The design finally approved was for a multiplex with four screens without any change in the number of seats.

Inox agreed to reduce the cost by Rs 1 crore for the reduction in the number of screens. The renovation of the existing old GMC buildings in the complex proposed by Inox was specifically excluded from the agreement.

Despite the change in the original financial quote the company finalised the contract at Rs 21.24 crore without availing the benefit of savings of Rs 3.11 crore.

The CAG report has also found fault with the GSIDC for paying an additional bonus of Rs 60 lakh to Inox for early completion of the multiplex after opening of the bids, which was undue favour of the contractor. The payment was made without confirming Inox's eligibility for the claim, given the contradictory certificates of Inox's own consultants.

The report emphatically states that as GSIDC did not carry out proper surveys, the tendering process suffered due to lack of transparency, tender evaluation process was faulty and there were cases of excessive payments, wasteful expenditure and over dependence of consultants on all major works.

With all these financial irregularities, the state government had no option than to refer the matter to the CBI for a proper investigation.