While the Coalgate issue continued to hit national headlines, the scandalous waste of Rs 105.57 crore lay buried in obscurity. This is related to the amount incurred in the construction of a thermal power station in Nagaland in 2003, only to be scrapped seven years back, said a report on Sunday by The Sunday Standard.

The report said the Public Accounts Committee (PAC) came down heavily on this bungling that is estimated to have cost the nation Rs 32 crore. A 22 MW heavy Fuel Oil (HFO) based thermal power project at Dimapur, Nagaland, was taken up during the NDA regime by the Ministry of Development of North East Region (DoNER).

At that time Minister for DoNER was BJP’s CP Thakur. The project was approved by Ministry of Power in September 2003. However, it was shut down after construction and purchase of the necessary equipment in May 2005 during UPA-I.

Currently, the government is looking to auction the machinery lying unused at the abandoned power plant.It is learnt that in June 2006, the Ministry of Power then headed by Sushilkumar Shinde realised that the cost of the electricity produced by Dimapur power plant would be very high as compared to the cost of power purchased by state government from other sources, said the report.

The difference per unit was estimated at around Rs 4 per unit. PR Kyndiah the then Minister of DoNER, was also kept in the loop.

After coming under fire from PAC in February 2011 for spending taxpayers money without due diligence, DoNER approached the Prime Minister Office in March 2011, seeking direction in the matter.

Sources said the PMO, after DoNER submission, asked the Committee of Secretaries (CoS) to look into the matter in June 2011.

“Committee of secretaries decided that the state government should use the land, and for construction work undertaken till date for other public purpose, it should auction the procured equipment and return the money to government of India,” sources said.

The committee of secretaries in a meeting in November 2011 asked the state to forego the difference in amount spent on buying original equipment and resale through auction and return whatever money it receives through proposed sale.

Quoting sources, the report said that CoS decision was based on the comments received from concerned ministries and state government after taking stock of machines and equipment.

DoNER, through a letter dated November 17, 2011 had asked the state government to initiate the process of auction and other formalities. A three months deadline was fixed to carry out the task. PAC pulled up government for not adhering to norms and adopting casual manner towards important projects.

Sources said in its draft observation and recommendation report distributed to members last month, the PAC stated that the Dimapur thermal power project fiasco would act as an eye opener for the ministry, it should take all viability and feasibility studies before spending taxpayer’s money on public projects.

It may be mentioned that on June 1 last, K. Miachieo, additional chief engineer, department of power, had said the contract was awarded to M/s. Bharat Heavy Electricals (BHEL) and accordingly in 2004, Ministry of DoNER allocated Rs.32 crore from non-lapsable central pool of resources for the project, said the statement.

Miachieo further said DoNER in November 2011 conveyed the decision of the CoS convened by the cabinet secretariat, Government of India directing Nagaland government to “auction the procured equipments and remit the proceeds to government of India”.