E-Paper
CITCO incurred ₹8.27 crore loss for running canteen at UT Secretariat, reveals CAG report
CITCO also incurred a loss of ₹1.52 crore on account of operating a guest house in New Delhi
Even as the Chandigarh Industrial and Tourism Development Corporation Limited (CITCO) struggles to generate revenue, it has incurred a deficit of Rs 8.27 crore for running the canteen at the UT Secretariat, said Comptroller and Auditor General (CAG) in its latest report.
CITCO also suffered a loss of Rs 1.52 crore on account of operating a guest house in New Delhi.
CITCO has been managing and operating a canteen at the UT Secretariat and a guest house at New Delhi on behalf of the Chandigarh administration since 1983 and 1990 respectively.
A draft agreement for the UT guest house at Delhi was sent by CITCO to UT administration for execution only in May 2016, which is yet to be formalised (July 2019).
“CITCO did not seek any agreement in respect of the UT Secretariat canteen in Chandigarh. CITCO operated a similar guest house in Chandigarh on behalf of the administration, where an agreement for defraying the expenses was available,” observed the CAG.
“In view of financial constraints and declining profitability faced by CITCO, it took up the matter with UT administration for reimbursement of the expenditure only in February 2014, but to no avail, in the absence of any agreement or even an understanding,” reads the report.
The audit further noted that the administration had agreed (February 1995) for a grant of ₹50,000 per month to CITCO for subsidising the eatables served in the canteen.
However, the administration has neither released the subsidy of Rs 50,000 per month to CITCO nor did CITCO made a formal claim for the same, which amounted to Rs 1.38 crore as on March 2018.
“In the absence of any agreement with the UT administration, expenditure incurred by CITCO on these two establishments, to the tune of Rs 9.79 crore till March 2018 is irregular,” notes CAG report.
The management replied (August 2018) to CAG objections that these activities were taken up as ‘a social function on non-commercial basis’. It added that the issue of reimbursement of expenses with the administration has also been followed up periodically.
The administration replied (August 2019) that a meeting was held on July 29, 2019, to discuss the issue of reimbursement of expenses in running the canteen and it was decided that CITCO and the hospitality department will send a proposal to the finance department, which is still awaited from CITCO.
