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Scams in UPA’s closet; CAG finds faults in Reliance’s KG-D6 marketing margin, Oil Ministry implicated

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(FILES) In this photograph taken on June 6, 2013 Reliance Industries Chairman Mukesh Ambani poses as he arrives for the company's annual general meeting in Mumbai. India's 100 richest people are for the first time all billionaires, according to an annual Forbes survey released September 25, 2014, with the country's top earners worth a third more combined than last year. Industrialist Mukesh Ambani topped the list for an eighth straight year with a 23.6-billion dollar fortune, Forbes India said on its website. AFP PHOTO/Indranil MUKHERJEE/FILES

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By NewsGram Staff Writer

Comptroller and Auditor General (CAG) has revealed discrepancies in the financial dealing between the Oil Ministry and Reliance Industries.

The CAG report presented to the Parliament on Tuesday said that the Oil Ministry in March 2009 had allowed Reliance Industries to charge a marketing margin on KG-D6 gas in US dollars rather than in rupees. This resulted in a Rs. 201 crore excess in subsidy payout.

The report said that while the marketing margin for GAIL was fixed in Indian rupees, for RIL the same was done in US dollars.

“Additional impact of charging of marketing margin by contractor…on 15 million standard cubic meters per day of KG-D6 gas (supplied to fertilizer units on an average) in excess of marketing margin allowed to GAIL, for the period from May 2009 to March 2014 works out to Rs 201.40 crore,” the CAG report said.

“Production Sharing Contract (PSC) for KG-D6 block did not provide for marketing margin component. The contractor (RIL), however, has been charging marketing margin based on the energy equivalent of gas supplied ie USD 0.135 per mmBtu,” the report said.

According to the report, charging marketing margin for a commodity produced, marketed and consumed domestically in US dollars “is incongruous with Indian market.” The report also revealed that the change meant that the margin which was Rs 244.31 per thousand cubic meters (mscm) in 2010-11 was increased to Rs 325.51 per mscm in 2013-14.

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Rajiv Mehrishi Takes Over as CAG of India

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Rajiv Mehrishi (IANS)

New Delhi, Sep 25: Former Home Secretary Rajiv Mehrishi assumed the office of Comptroller and Auditor General (CAG) of India today. He took the oath of office before President Ram Nath Kovind at a ceremony held at Rashtrapati Bhavan, New Delhi.

Mehrishi succeeds Shashi Kant Sharma, former CAG of India, who demitted office on September 22 of this year.

Mehrishi, who retired as Home Secretary in August at the end of a two-year extension, will have a tenure as CAG until August 7, 2020, when he will turn 65.

Mehrishi belonged to the 1978 batch of the Indian Administrative Service (IAS) of Rajasthan cadre.

He was appointed Union Home Secretary in August 2015. Prior to that, he was Finance Secretary at the Centre and Rajasthan Chief Secretary.

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Setback for Kejriwal govt, Delhi HC rules against CAG audit of discoms

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New Delhi: In a setback for the Arvind Kejriwal government, the Delhi High Court on Friday allowed the pleas of three city discoms challenging the government’s decision to have their accounts audited by the Comptroller and Auditor General (CAG).

A division bench of Chief Justice G Rohini and Justice R S Endlaw allowed the pleas of Tata Power Delhi Distribution Ltd., BSES Rajdhani Power Ltd. and BSES Yamuna Power Ltd., implying the official auditor of the government cannot audit their accounts.

Meanwhile, Delhi chief minister Kejriwal said his government will file an appeal in the Supreme Court against the high court’s decision and that they were committed to providing cheap electricity to the people of the national capital.

The discoms — Tata Power Delhi Distribution Ltd (TPDDL), BSES Rajdhani Power Ltd and BSES Yamuna Power Ltd — had challenged the AAP government’s January 7, 2014, decision ordering a CAG audit of their accounts.

The discoms had also challenged an order of a single judge of the high court who had refused to stall the CAG audit.

The single judge, in his January 24, 2014 order, had also asked the discoms to “fully cooperate with CAG in the audit process”.

While allowing the discoms’ pleas on Friday, the court dismissed a PIL filed by NGO United RWAs Joint Action (URJA) which had sought an audit of the discoms’ accounts by CAG.

Earlier, the Delhi government had told the court that a CAG audit of the private discoms here was necessary as these companies discharged “public function”.

The discoms are a 51:49 per cent joint venture between the private companies and the Delhi government.

(With inputs from agencies)

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Kerala: Big blow for ‘Hub and Spoke’, CAG calls it a failure

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Thiruvananthapuram: The much publicised ‘hub and spoke’ Kerala model for IT development has turned a cropper, a report of the Comptroller and Auditor General (CAG) has said.

It was learnt from the report, which was tabled in Kerala assembly on Monday (June 29) and made available on Thursday, that 80.76 percent of the built up area at seven locations remained unallocated as the land acquired was mainly in remote localities and not suitable for IT purposes.

Speaking to IANS on Thursday, Kerala IT secretary P.H. Kurian said that they are doing their best to showcase these locations to prospective investors.

n6 hub and spoke
The CAG audit reports pointed out that it was as per the IT Policy 2007 that envisaged creation of a ‘hub and spoke model’ of IT development with two large IT parks at Thiruvananthapuram and Kochi functioning as the hub for smaller IT parks in other parts of the state.

The CAG report said that KSITL acquired 402.65 acres of land at seven different places in the state to set up the ‘hub and spoke’ model for IT development.

The IT Policy 2007 came when V.S. Achuthanandan-ruled Left government was in office from 2006-11.

Incidentally, it was the state-owned Kerala State Information Technology Infrastructure Limited (KSITL), which was responsible for the development of IT cities in the public private partnership model and had set up these new IT parks under the ‘hub and spoke’ model.

“The land acquired was mainly in remote localities and was not suitable for IT purpose. As a result 320.66 acres of land was not allotted till-November 2014,” said the CAG report.

Incidentally, the state government incurred a cost of Rs.229.88 crore for acquisition of land and for developing infrastructure facilities in these seven locations.

The seven locations include Kundara (Kollam district),Ambalappuzha and Cherthala (both in Alappuzha district), Koratty (Ernakulam), Kozhikode, Kannur and Kasargod.

Of these, at Amabalapuzha, Kannur and Kasargod, the land has been acquired, while at the other places, the percentage of idling of land was as high as 77.34 percent.

(IANS)