Rs 700 cr scam derails Railway’s freight project | delhi | Hindustan Times
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Rs 700 cr scam derails Railway’s freight project

delhi Updated: Sep 19, 2010 01:43 IST
Srinand Jha
Srinand Jha
Hindustan Times
Highlight Story

The railway ministry’s ambitious freight corridor project has been hit by a Rs 700 crore scam. Part of the project was funded by the World Bank. The Dedicated Freight Corridor Corporation of India Limited’s (DFCCIL) managing director V.K. Kaul has been sent on long leave.

Even more embarrassingly, the World Bank sent a six member probe team to investigate the allegations of the scam. This followed preliminary findings of the Central Vigilance Commission (CVC) about alleged irregularities in three contracts awarded by the DFCCIL, a public sector undertaking, in 2008.

The present controversy has put a question mark over the World Bank-financed Rs 4,000 crore contract — which the DFCCIL was scheduled to shortly award. World Bank spokesman Sudip Mozumder told Hindustan Times, “A governance and accountability action plan is under preparation.”

CVC secretary K.S. Rama-subban listed out charges of “serious corruption” and “criminal conspiracy against public interest” by the DFCCIL.

A response to the Chairman, Railway Board’s (CRB) queries to DFCCIL was received on August 3. So far, there has been no action against Kaul. The CRB chose not to reply to HT’s queries and Kaul refused to comment as well.

The allegations

1. Western Corridor deal awarded at R605cr against tendered cost of R419cr
2. Contract for Eastern Corridor awarded at R781 crore against estimated cost R568cr
3. General Consultancy contract of R133cr awarded through limited tender
4. Awarding tenders over R200 cr by revising initial estimates after opening of financial bids