Report of the Comptroller and Auditor General of India for the year ended 31 March 2017 Government of Uttarakhand Report No.1 of the year 2018 Table of Contents Description Reference to Paragraph Page No. Preface v Overview vii Chapter-I Social, General and Economic Sectors (Non-PSUs) Budget Profile 1.1.1 1 Application of resources of the State Government 1.1.2 1 Funds transferred directly to the State implementing agencies 1.1.3 2 Grants-in-Aid from Government of India 1.1.4 2 Planning and conduct of Audit 1.1.5 2 Significant audit observations and response of Government to Audit 1.1.6 3 Recoveries at the instance of Audit 1.1.7 3 Responsiveness of Government to Audit 1.1.8 4 Follow-up on Audit Reports 1.1.9 4 Status of placement of Separate Audit Reports of autonomous bodies in 1.1.10 5 the State Assembly Year-wise details of performance audits and paragraphs that appeared in 5 1.1.11 Audit Reports PERFORMANCE AUDIT PEYJAL DEPARTMENT Rejuvenation of River Ganga 1.2 6 National Rural Drinking Water Programme 1.3 31 COMPLIANCE AUDIT PEYJAL DEPARTMENT Construction of toilets under Swachh Bharat Mission (Gramin) 1.4 51 DEPARTMENT OF ENERGY Follow-up audit of the performance audit of Hydropower 1.5 58 Development through Private Sector Participation MEDICAL, HEALTH & FAMILY WELFARE DEPARTMENT Suspected embezzlement on hiring of vehicles 1.6 66 PUBLIC WORKS DEPARTMENT Unjustified excess expenditure of ` 1.69 crore 1.7 67 Unauthorised excess expenditure 1.8 68 Unfruitful Expenditure of ` 0.70 crore 1.9 70 Unjustified excess expenditure 1.10 71 Non-achievement of objectives 1.11 73 UTTARAKHAND PEYJAL SANSADHAN VIKAS EVAM NIRMAN NIGAM Unfruitful expenditure 1.12 74 URBAN DEVELOPMENT DEPARTMENT Solid Waste Management in Nagar Nigams of Dehradun and 1.13 76 Haridwar i Chapter-II Revenue Sector Trend of revenue receipts 2.1.1 89 Analysis of arrears of revenue 2.1.4 91 Arrears in assessments 2.1.5 92 Evasion of tax detected by the Commercial Tax Department 2.1.6 92 Refund cases 2.1.7 93 Response of the Departments towards audit 2.1.8 93 Analysis of the mechanism for dealing with the issues raised by Audit 2.1.9 95 Action taken on the recommendations accepted by the Departments/ 2.1.10 96 Government Audit Planning 2.1.11 96 Results of audit 2.1.12 96 Coverage of the Revenue Chapter 2.1.13 97 COMPLIANCE AUDIT COMMERCIAL TAX DEPARTMENT Non-imposition of penalty 2.2 98 Unauthorised utilisation of Form-11 2.3 99 Short levy of tax 2.4 100 Non-imposition of penalty 2.5 101 Non-levy of tax and penalty 2.6 101 EXCISE DEPARTMENT Working of Distilleries in the State 2.7 103 GEOLOGY AND MINING DEPARTMENT AND STAMP AND REGISTRATION DEPARTMENT Short levy of stamp duty 2.8 113 Mining Department Short levy of penalty 2.9 114 Short/non-levy of royalty 2.10 115 Chapter-III Social and Economic Sectors (Public Sector Undertakings) Introduction 3.1.1 117 Accountability framework 3.1.2 117 Statutory Audit 3.1.3 118 Role of Government and Legislature 3.1.4 118 Stake of State Government in the Public Sector Undertakings 3.1.5 118 Investment in State PSUs 3.1.6 119 Special support and returns during the year 3.1.7 120 Reconciliation with Finance Accounts 3.1.8 121 Arrears in finalisation of accounts 3.1.9 122 Placement of Separate Audit Reports 3.1.10 123 Impact of non-finalisation of accounts 3.1.11 123 Performance of PSUs as per their latest finalised accounts 3.1.12 123 Winding up of non-working PSUs 3.1.13 125 Accounts Comments 3.1.14 125 ii Response of the Government to Audit 3.1.15 126 Follow up action on Audit Reports 3.1.16 126 Discussion of Audit Reports by Committee on Public Undertakings 3.1.17 127 Compliance to Reports of Committee on Public Undertakings 3.1.18 127 Recoveries at the instance of audit 3.1.19 127 Disinvestment, Restructuring and Privatisation of PSUs 3.1.20 127 Coverage of this Chapter (PSUs Chapter) 3.1.21 127 COMPLIANCE AUDIT UTTARAKHAND FOREST DEVELOPMENT CORPORATION Award of work without verifying credentials of agency 3.2 128 Irregular contribution of Employees Provident Fund 3.3 129 UTTARAKHAND JAL VIDYUT NIGAM LIMITED Cost overrun due to delay in completion of project w ithin the 3.4 130 scheduled time frame Loss due to failure to take an appropriate insurance policy 3.5 131 UTTARAKHAND POWER CORPORATION LIMITED Bill Generation and Revenue collection by Uttarakhand Power 3.6 132 Corporation Limited Appendices Appendix Page Particulars No. No. 1.1.1 Position regarding receipt of ATNs on the paragraphs included in the ARs 143 1.2.1 Details of projects selected for audit 145 1.2.2 Questionnaire for beneficiary survey 146 Details of the audit finding on compliance with the directions issued by 1.2.3 147 Hon’ble High Court of Uttarakhand Present Status of 180 Industries/Units to whom Show Cause Notices 1.2.4 153 were issued during 2015-16 1.2.5 List of Industries declared as closed 157 Present Status of 44 defaulting industries which were served Closure 1.2.6 158 Notices during 2014-15 List of closed Industries which were served Show Cause Notices during 1.2.7 159 2014-15 Present status of 106 defaulting industries which were served Closure 1.2.8 160 Notices during 2015-16 1.2.9 List of closed Industries which were served Closure Notices during 2015-16 162 1.2.10 Details of Nallas discharging sewage into the River Ganga 163 Details of penal interest which the State Government is liable to pay due 1.3.1 164 to delayed release of fund to the SWSM 1.3.2 Details of testing of water quality in four test-checked districts 165 1.13.1 Year-wise details of funds received by NN Dehradun and Haridwar 166 Statement showing details of non-levy of penalty in respect of the four 2.2.1 167 cases related to two dealers Statement showing details of unauthorised utilisation of Form-11 by four 2.3.1 168 dealers related to three offices of Commercial Tax Department iii Details of short levy of tax in 10 cases of seven dealers related to two 2.4.1 169 DCs and three ACs 2.5.1 Statement showing non-imposition of penalty due to late deposit of tax 170 2.7.1 A Non-levy of minimum Guaranteed Duty on Higher Strength of Country Liquor 171 2.7.1 B Non-levy of Excise Duty on Higher Strength of Foreign Liquor 171 2.7.2 A Non-achievement of Fermentation Efficiency 172 2.7.2 B Non-achievement of minimum Distillation Efficiency (DE) 174 2.7.2 C Transit loss of Total Reducing Sugar (TRS) 175 2.7.2 D Transit loss of Molasses 175 2.7.3 Unauthorised production during rainy season 176 2.7.4 Production in excess of daily production capacity 177 Short levy of Stamp Duty in respect of 21 agreements of two screening 2.8.1 179 plant owners (Dehradun) and three stone crusher owners (Chamoli) Short levy of Stamp Duty due to wrong valuation of property in case of 2.8.2 181 two lease deeds Details of short levy of penalty on owners of vehicles found guilty of 2.9.1 182 illegal mining/transportation of minerals 2.10.1 Details of short levy of royalty 183 2.10.2 Details of royalty due on owners of brick kilns upto 2015-16 183 Statement showing investments made by State Government in PSUs 3.1.1 184 whose accounts are in arrears Summarised financial position and working results of Government 3.1.2 companies and Statutory Corporations as per their latest finalised 185 financial statements/accounts 3.4.1 Statement showing innumerable delays in execution of project 187 3.4.2 Statement showing the claimed amount vis-à-vis allowed amount by UERC 188 Statement showing the penalty amount imposed by UERC due to delay in 3.6.1 189 release of new connections during 2014-15 to 2016-17 Statement showing the Energy received, Sale of energy, Loss of energy, 3.6.2 Permissible losses, Avoidable loss of energy in distribution and Total 190 Avoidable Loss Statement showing the details of Distribution loss due to theft/pilferage 3.6.3 191 for the period from 2014-15 to 2016-17 3.6.4 Statement showing the status of DTR Metering 193 3.6.5 Statement showing the details of MRI due and done of KCC consumers 194 Statement showing the details of meter reading through AMR or Manual 3.6.6 195 in respect of KCC consumers as on March 2017 Statement showing the details of Initial Security not deposited as on 3.6.7 196 March 2017 in respect of various categories Statement showing the details of RCs issued, realised, returned and 3.6.8 197 pending for realisation during the period from 2014-15 to 2016-17 Statement showing the details of Additional Security required as on 3.6.9 198 March 2017 in respect of KCC consumers (RTS-2 and 7) iv PREFACE This Report of the Comptroller and Auditor General of India for the year ended 31 March 2017 has been prepared for submission to the Governor of the State of Uttarakhand.