CAG report to form basis of lokayukta probe

  • Rajesh Kumar Singh, Hindustan Times, Lucknow
  • |
  • Updated: Nov 12, 2012 12:24 IST

The Comptroller and Auditor General (CAG) report on the sale of 21 sugar mills during Bahujan Samaj Party (BSP) rule will be the basis of the lokayukta probe into alleged irregularities and corruption in the process.

The state cabinet ordered the lokayukta probe on November 6.

Talking to HT, lokayukta justice (retd) NK Mehrotra said,
“Since the CAG has done a performance audit of the mills of the UP State Sugar Corporation Limited (UPPSSCL), I have sought a copy of the audit report. I have also urged the state government to issue a notification for the lokayukta probe.”

A senior state government officer said, “A majority of the sugar mills went to liquor baron Gurdeep Singh Chadha alias Ponty Chadha who was perceived to be close to Bahujan Samaj Party (BSP) supremo Mayawati.”

The ombudsman is also probing corruption and disproportionate assets cases against former ministers of the BSP government, as well as irregularities in the construction of memorials and parks and auction of farmhouses in Noida.

“I will urge the state government to attach an investigating agency or grant funds for hiring a specialised agency to assist me in the sugar mills probe,” justice Mehrotra said.

The state government has already asked the economic offences wing (EOW) to assist the lokayukta in the memorials/parks construction scam probe.

This is the second time the lokayukta will probe the sugar mills selloff.

The ombudsman had first initiated a probe on the complaint of farmer leader VM Singh.

But, the BSP government moved a petition before the lokayukta, urging him to drop the inquiry as the matter was pending in the Allahabad high court and the decision to auction the sugar mills was taken by the state cabinet and thus could not be looked into by the ombudsman which can only examine acts of public servants.

 “I was left with no other option but to drop the probe as the state government told me that the matter was sub judice and the decision to sell the sugar mills was taken by the cabinet,” justice Mehrotra said.

He added now that the cabinet had ordered an inquiry, he would have to abide by the directive.

In 2007, the BSP government decided to privatise 10 operational sugar mills belonging to the Uttar Pradesh State Sugar Corporation Ltd (UPSSCL) and 11 closed mills belonging to its subsidiary Uttar Pradesh Rajya Chini Evam Ganna Vikas Nigam Ltd (UPRCGVNL). The 21 mills were sold between July 2010 and March 2011.

Later, the CAG detected anomalies in the sale process. These related to undervaluation of land and plant machinery, lack of competition in the bidding process, as well as stamp duty and procedural lapses.


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