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NC Hills Council scam and ex-Governor Singh’s role
Published on 28 Nov. 2010 11:46 PM IST
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It is now an established fact that huge amounts of money provided to the NC Hills Autonomous Council by the Central and State Governments were misused over the years, but has now come to light that the Council also lost substantial amounts of revenue due to large-scale irregularities and the name of a former Governor also cropped up in the report of the special audit of the accounts of the Council carried out by the office of the Accountant General (AG).
The report of the special audit, which is available with The Assam Tribune, reported that the Council lost substantial amount of revenue because of the irregularities committed in supply of bamboo to the Hindustan Paper Corporation (HPC), while, the Council also lost huge amounts due to the failure to collect the land revenue.
The report said that in October, 2006, the Council signed memorandum of understanding with three contractors for extraction and supply of 2.90 lakh metric tonne of bamboo to the HPC on payment of royalty to the Council at the agreed rates. In December, 2006, one of the contractors reported rejection of the “Muli” species of bamboo by the HPC without any recorded reasons and the Council filed a writ petition to the Gauhati High Court. Following that, the HPC agreed to accept the “Muli” bamboo at a much lower rate, which was not accepted by the contractors. An arbitrator was appointed to look into the matter and he awarded compensation amounting to Rs 18.09 crore to three contractors proportionately. The award was accepted by the Governor of Assam and he directed the Council to pay Rs one crore in the proportion of the award amount and also to waive royalty of Rs 50 lakh.
However, in January, 2008, Rs one crore was paid to one single contractor against the direction of the Governor. It may be mentioned here that Lt Gen (Retd) Ajai Singh was the Governor of Assam at that time. The report further said that further amount of Rs one crore was paid to another contractor in March, 2008 without the approval of the executive committee of the Council and the records proved that the payment was authorized by the Chief Executive Member.
In fact, the audit report found a number of other glaring irregularities in supply of bamboo to the HPC. During the period from 2007-08 and 2008-09, orders were issued to five contractors for supply of 4.34 lakh MT of bamboo but only 80,000 MT was supplied, which resulted in loss of revenue amounting to Rs 3.95 crore. Even the penalty amount of Rs 88 lakh was not realized from the contractors by the Council as per terms of the contracts. There were several occasions when the royalty rates were reduced without any valid reason resulting in huge loss of revenue. The report further said that records of the Divisional Forest Officer on the quantity extracted were ignored.
The audit report said that during the period from 2007-08 to June 12, 2009, the target for collection of land revenue was Rs 8.02 crore against which, only Rs 3.79 was collected, leaving a shortfall of Rs 4.23 crore. The reasons for the shortfall were not on record. However, the Council stated before the AG that the collection target could not be achieved due to law and order problem.
The reply was not tenable on the ground that the target for collection of land revenue was fixed by the Council every year taking into account the prevailing situation in the district since law and order problem in NC Hills is a regular feature, the report pointed out.
The audit also found glaring irregularities in financial management and said that funds were diverted from development schemes to meet the other inherent expenditures. The report revealed that the Council is to meet its expenditures on salaries and non salary components related to inherent functions out of revenue generated from its own sources. But in 2007-08, the expenditures on the same heads amounted to Rs 27.93 crore against revenue of Rs 7.43 crore. The position was worse in the following year when the Council spent Rs 39.11 crore against revenue generation of Rs 6.63 crore and up to June 12 in the following year, the Council spent Rs six crore against revenue generation of Rs 50 lakh, the report said. The excess expenditure was made by diversion of funds from the schemes under Agriculture, Education, PHE ad Health Departments, the report added.

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