Title - Railways losses at Rs 2,461cr in FY11

The comptroller and auditor general of India (CAG) on Tuesday flayed Indian Railways for incurring avoidable losses of Rs 2,460.89crore in 2010-11 due to irregularities in freight concessions, procurement and maintenance operations and time overrun in projects.

CAG’s 2011-12 compliance audit report on Indian railways tabled in the parliament said there was large undue benefit of Rs 1,795.51 crore given to consigners of iron ore though they were not complying with the conditions for availing the freight concessions on traffic booked as domestic traffic.

The CAG audit found that 99 consigners, mainly iron and steel companies, from Kirandul, Bacheli and Jagdalpur stations, had booked consignments from May 22, 2008 to March 31, 2011 either without submitting the required documents or had submitted incomplete documents.

“Despite this, the east coast railway administration had allowed them the benefit of

concessional rates, resulting in undue benefit of Rs 1795.51 crore,” it said.

The CAG report further says that railways have incurred avoidable loss of Rs 284.20 crore due to delay in completion of new rail bridge over Sona river on the Delhi-Howrah route besides incurring losses on account of another avoidable expenditure of Rs 13.64 crore in strengthening of old bridge across river Tungabhadra on Wadi-Guntakal section in lieu of rebuilding a new bridge.

As per the CAG findings, central and western railways had incurred revenue loss of Rs 70.27 crore by allowing movement of steel, coal and salt to be carried on longer route though charging them for the shorter route.

The auditor has accused railway ministry for not finalising tenders within the valid time and its failure in properly assessing the quoted rates, which in turn resulted in avoidable extra expenditure of Rs 52.9 crore towards procurement of steel in the subsequent contracts in March 2009.

The other avoidable expenditure made by railway ministry in 2010-11 include loss of Rs 29.69 crore due to empty haulage of unutilised parcel vans, loss of Rs 15.4 crore owing to sub optimal leasing of parcel cargo express, poor quality of linen service in departmentally managed trains at higher cost resulting in loss of Rs 14.87 crore, non recovery of wagon hire chrages of Rs 26.81 crore at revised rate and loss of Rs 25.77 crore due to heavy detention of wagons.