It's like Harry Houdini’s ‘vanishing elephant’ act. In Punjab, state government agencies can transport paddy by 3,232 trucks that are actually invisible.
Crores of rupees can be paid to the transporters for moving the food stock to the Food Corporation of India (FCI) godowns .
It has now come to light that in the state, the FCI hired four top nodal state government agencies that transported paddy by 3,232 trucks that don’t exist; and in certain cases even by “trucks” that actually looked like scooters and motor cycles, or were too rickety even to move.
And several crores of rupees were paid to the transporters as the cost for transporting paddy by such questionable “trucks” between 2009 and 2014.
Data provided by these state agencies on at least 3,232 trucks led to a large dark hole, as no record regarding registration of these vehicles could be traced by the Comptroller and Auditor General (CAG) of India.
According to claims made by the FCI and the agencies, 3,319 vehicles were hired to transport paddy to FCI godowns, but the CAG could verify only 87 of these vehicles, of which 15 are two-wheelers.
These 15 vehicles included three scooters, three motor cycles, four cars, one tractor, one three-wheeler, one jeep and one towing truck.
No record for rest of the “trucks” could be verified due to lack of concrete information.
Red-flagged
Appalled by the falsity of the data, the CAG has now red-flagged the claims made by the FCI and the nodal agencies—Punjab State Warehousing Corporation (PSWC), Punjab Agro Foods Corporation, Punjab Grains Procurement Corporation Ltd. (PUNGRAIN) and Punjab State Civil Supplies Corporation Limited (PUNSUP) besides the FCI staff—that were hired to transport the paddy to FCI godowns.
“The system could trace only 87 vehicles out of which 15 (17.24 per cent) vehicles, said to be used for transportation, were other than trucks (three scooters, three motor cycles, four cars, one tractor trailer, one three wheeler, one jeep and one towing truck).
"Hence, the transportation of paddy through these vehicles is doubtful,” the report said.
The CAG report said that the registration records pertaining to the other 3,232 vehicles hired by the four Punjab nodal agencies were missing.
It was also found during the audit that some of the vehicles claimed to have been hired either did not exist or were rickety.
Some were hired from other states for which no record was available with the agencies and the transportation department.
“The SGAs (state government agencies) had provided hard copies of the registration numbers of the vehicles used in transportation and audit had selected non-repetitive 3,319 vehicles at random of 31 mandis.
"These numbers were put to the data bank of Vehicle Registration Authority of the government. Out of this, the data bank could not trace the registration information in respect of 3,232 (97.38 per cent) vehicles being registered out of state or being very old and not fed in the computerised data of the transport authority,” it said.
The CAG report said that the expenditure on transportation of paddy and rice within and beyond eight kilometres is a huge component of cost for SGAs, and a major portion of this is not being reimbursed by the FCI.
A test check of 16 district offices of four procuring agencies by audit, in the four selected districts of the SGAs, revealed the misuse of transportation charges.
The FCI and four leading nodal agencies paid Rs 13.86 crore to various transporters as transportation cost for lifting 4.36 lakh MT of paddy between 2009 and 2014.
“Out of 16 district offices of four SGAs, seven district offices of three agencies involving 751 mandis (markets) in 21 crop years did not provide information to audit relating to the number of vehicles used for transportation of paddy, which constituted 19.92 per cent of the total transportation cost,” the report said.
The CAG report said the other nine offices, which provided information, furnished incomplete registration numbers of 41,033 vehicles used in 146 mandis in 23 crop years (taking five crop years of each district office—from 2009-10 to 2013-14) from which it is not possible for the district offices of the audit to verify the genuineness of the same.
“The audit is not in a position to comment on the authenticity of the transportation of 4.36 lakh MT of paddy involving an expenditure of Rs 13.86 crore constituting 4.51 per cent of total transportation cost,” says the report.
CAG report blames FCI for 'corruption'
A Second Comptroller and Auditor General (CAG) report has put the responsibility of frauds committed by procurement agencies on the Food Corporation of India (FCI).
The report says that while the FCI procures 46 per cent food grains from Punjab, 41 per cent vigilance cases also emanate from this state.
A review conducted by the Vigilance Division—the nodal agency in the FCI for the prevention of fraud, corruption and other malpractices— has revealed that procurement, handling, storage and quality control are the ‘high risk’ areas under the FCI.
“A flawed system of verification of sub-standard paddy has revealed that 2.91 lakh MT of paddy valuing Rs 160.05 crore procured during the periods 1997 to 1998 and 2000 to 2001 was of substandard quality,” the recent audit report said.
The Vigilance Division had found that procurement operation equipment—such as moisture metres, crates and tarpaulins— were not provided in several state mandi units.
During the procurement of paddy, technical staff at mandis neither exercised quality-related checks effectively nor was their work properly checked or supervised.
The report added that for the periods ranging from 1999 to 2000 and from 2000 to 2001, substandard 1.72 lakh MT rice worth Rs 171.46 crore was found to have been incorrectly accepted by the technical staff “in connivance with officers up to the level of district managers in two districts”, the report said, adding that the FCI had not even ensured full payments to farmers through commission agents.
Transit flaws Besides sub-standard operation, transit shortage of Rs 805.41 crore was noticed from 1997 to 1998 and from 2000 to 2001.
Reasons attributed to this loss were no proper administrative deterents to check loss on account of incorrect and inefficient records, manipulation in moisture content, non-fixation of norms of storage shortage and delay in processing, among other reasons.
“The corporation regularised shortage amounting to Rs 2,232.87 crore against which Rs 21.23 crore (0.95%), only on account of abnormal shortages, was recovered from employees,” the report stated.
Labour fraud
The CAG report also pointed out expenditure of Rs 48.18 crore was incurred from 1986 to 1987 and from 1999 to 2000 on irregularly appointed casual labour.
“There was no assurance against the fraudulent nature of these appointments,” it said, adding that the Vigilance Division had also not undertaken any exercises for streamlining procedures intended to control corruption.
Out of 667 personnel on the ‘agreed list’ of officers with ‘doubtful integrity’ in 2001, 340 (51%) officers belonged to the Punjab Region.
Contrary to instructions, 299 of these officers were deployed on sensitive duties and 149 officers of them had continued to be on the same list for five years.
Punjab wants Centre to pay transport cost
The Punjab government had, in December last year, asked the Union Government to pay Rs 24,431 crore towards procurement of food grains.
Out of the total amount demanded, Rs 1,506 crore was sought as charges for transportation of paddy from grain markets to storage points.
Besides demanding the procurement charges, the state government had also asked the Union Finance Ministry to pay Rs 1,129 crore towards non-reimbursement of losses suffered due to the sale of paddy between 1994 and 1995.
An additional payment of Rs 1,663 crore was sought as establishment cost.
However, the Finance Ministry had denied the payment of bills from the cash credit limit and, instead, asked the state government to settle an account of about Rs 42,000 crore which the latter had taken earlier from the Union treasury for development of the food sector.
Punjab, the wheat bowl of India, contributes 1.14 crore tonnes of wheat annually while 263 lakh tonnes is procured from various other states, including Haryana.
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