CAG flaks industries, commerce deptt

Rs 1.58 cr avoidable interest payments made

BILAL HUSSAIN

The Comptroller and Auditor General (CAG) of India has flaked the industries and commerce department in the recent report ended March 2009 for loss of funds on account of avoidable interest payments.
The CAG report said, “Lack of clear and timely decision on land compensation resulted in avoidable expenditure of Rs 1.58 crore as interest payment.”
For acquisition of about 1000 kanals of land required for establishment of Industrial Estate at Ompora, Budgam the collector, land acquisition, Budgam in his tentative award in October, 1992 had fixed the rates of compensation to land owners for two types of land, viz. Baghi Khushki and Baghi Maidani at Rs 75,000 and Rs 65,000 per kanal respectively and referred the rates in July 1996 to the government for approval.
While approving the rates in April 1997, the government scaled down the land compensation rates to Rs 40,000 and Rs 35,000 per kanal for Baghi Khushki and Baghi Maidani land, respectively, without any recorded justification, the report makes a mention.
The payments to the land owners were made in April 1997 in accordance with the lower rates determined by the government. The land owners, not satisfied with the rates fixed by the Government, received the payment under protest and approached the court of law.
While defending the case in the court, the department was not able to give plausible reasons for scaling down the rates. The District Judge, Budgam accordingly decided November 20, 2000 that the petitioners were entitled to compensation at the rates of Rs 75,000 and Rs 65,000 for Baghi Khushki and Baghi Maidani, respectively, with interest at the rate of six per cent for the enhanced amount from November 20, 2000 to September 2008.
The industries department approached the High court in May 2001 which upheld June 2008, the judgment given by the lower court. On its direction, the department paid land compensation of Rs 3.85 crore at enhanced rates and an interest of Rs 1.58 crore thereon in terms of the court judgment.
The matter was referred to the government/department in July 2009. The Director, industries and commerce stated August 2009 that all the levels of the revenue department from collector to the administrative department were responsible for the extra payment to the landowners, which had to be paid by the industries and commerce department for no fault on its part. “The government endorsed the reply of the Director,” the report said.