Three key CAG reports were tabled in Parliament last week indicting the government of causing a combined loss of crores of rupees to the national exchequer.
The much-awaited CAG report on coal block allotment said private firms are likely to gain Rs 1.86 lakh crore from coal blocks that were allocated to them on nomination basis instead of competitive bidding.
The audit report on Delhi airport slams the levy of development fee on passengers and says the civil aviation ministry violated the bid conditions for the benefit of GMR-led DIAL to the tune of over Rs 3,415 crore.
The third CAG report flays post-bid concessions to Reliance Power and says the Anil Ambani-led firm got undue benefit of Rs 29,033 crore when the government allowed use of surplus coal from blocks alloted to Sasan power plant for its other projects.
Reacting to the CAG reports, minister of state in Prime Minister\’s office V Narayanasamy said that the govt auditor was not following its mandate.
Meanwhile, the BJP demanded resignation of the government alleging that scams in the coal, power and airport sectors had exposed the "loot and plunder" of the country. "
The party sought Prime Minister\’s resignation as he headed the coal ministry at the time of alleged irregularities.
CAG\’s coal report
The CAG in its report, tabled in Parliament, names 25 companies including Essar Power, Hindalco, Tata Steel, Tata Power and Jindal Steel and Power which have got the blocks in various states.
"Delay in introduction of the process of competitive bidding has rendered the existing process beneficial to the private companies. Audit has estimated financial gains to the tune of Rs 1.86 lakh crore likely to accrue to private coal block allottees," CAG said in a report on allocation of coal blocks. The CAG said it has arrived at the estimates based on the average cost of production and average sale price of opencast mines of Coal India in the year 2010-11.
"A part of this financial gain could have accrued to the national exchequer by operationalising the decision taken years earlier to introduce competitive bidding for allocation of coal blocks," CAG said.
The auditing description said it is "of strong opinion that there is a need for strict regulatory and monitoring mechanism to ensure that benefit of cheaper coal is passed on consumers".
The concept of allocation of captive coal blocks through competitive bidding was announced in 2004. However, government is yet to finalise the modus operandi of competitive bidding.