Rs 15 cr spent on vessel repair by VOC Port 'injudicious': CAG

Comptroller and Auditor General has said the Rs 15.17-crore worth repair to an outlived ship named MT Indira Gandhi by VO Chidambaranar Port was an "injudicious expenditure", while the vessel was disposed of for a petty Rs 62.57 lakh.
"VO Chidambaranar Port Trust incurred an injudicious expenditure of Rs 15.17 crore on repairing of an outlived tug which after unsatisfactory performance was disposed of for Rs 62.57 lakh," the official auditor said in its report tabled in Parliament today.
The expenditure on a tug - MT Indira Gandhi built in 1987 with a life expectancy of 20 years for its shipping operations, was done despite a committee constituted by the Port questioning a proposed expenditure of Rs 8.25 crore on dry docking.

Earlier the Deputy Conservator of the Port has also said that it would not be economical to incur further expenditure on dry docking as the tug had almost outlived its economical life.
"Despite the above views the Board resolved to carry out dry docking repair works to tug MT Indira Gandhi because the time required for procurement of tug ranged between 18-24 months and approved the expenditure of Rs 8.25 crore. However, the port repaired the tug at a final cost of Rs 15.17 crore in 23 months at Cochin Shipyard Ltd," the Comptroller and Auditor General said in the report.

The performance of the revamped tug was poor as it was not powerful in shipping operations and it was mainly used for standby/watch duty purposes for transporting crew/surveyors from shore to the vessels at anchorage only, it said.

It added that its utilisation was only 12.79 per cent in 2009-10, 9.18 per cent in 2010-11 and 7.26 per cent in 2011-12.
CAG said, "In the meantime, action was initiated for next dry docking and the cost was approximately estimated to be Rs 5.32 crore. Considering poor performance, age and estimated expenditure on dry docking of the tug without any further life assurances, the Board decided to replace the tug. VOCPT finally disposed of the tug in January 2015 for Rs 62.57 lakh."

It concluded, "Thus, Port's decision to incur and expenditure of Rs 15.17 crore on an outlived tug against the technical opinions for repairing was avoidable and lacks justification.