The Comptroller and Auditor General on India (CAG) has found alleged irregularities in the construction of the Shahpur Kandi dam project on river Ravi in Punjab.
The Principal Accountant General (Accounts and Entitlements), in its annual review of the working of public works division of water resources department in the state, has pointed out “avoidable payment” of ₹ 42 crore on account of compensation and interest to a private contractor. Of this, ₹ 38.64 crore was compensation for “idle machinery and labour” and ₹ 3.37 crore given as interest for delayed payment.
The award and commencement of work without ensuring settlement interstate dispute resulted in avoidable payment of compensation as well as delayed payment of interest, according to the report based on the annual review as well as central audit of the water resources department for the financial year 2021-22. The work for construction of main dam comprising overflow section and non-overflow sections, head regulator of Shahpur Kandi hydel channel (balance work) was awarded to the contractor on March 8, 2013, for a period of 42 months for completion of work.
As per the agreement, the site free of all encumbrances along with the available access route was required to be handed over to the contractor for execution of work. The project, however, got stalled in August 2014 due to inter-state issues, including the enactment of the Punjab Termination of Agreement Act, 2004. “Passage of this act along with huge delay in construction of the Shahpur Kandi project by the Government of Punjab and certain structural alterations by it in the original design led to reservations from J&K regarding sharing of water as envisaged in original agreement,” according to the annual review report.
The work on the ₹ 2,793 crore dam, which will generate power and irrigate 36,000 hectares of land in Punjab and J&K, was restarted in 2018-19 and is slated to get completed next year. The annual review has also flagged the alleged “undue favour” shown to a contractor in tax calculation and sought justification. Water resources department officials did not respond to calls.
{{/usCountry}}The work on the ₹ 2,793 crore dam, which will generate power and irrigate 36,000 hectares of land in Punjab and J&K, was restarted in 2018-19 and is slated to get completed next year. The annual review has also flagged the alleged “undue favour” shown to a contractor in tax calculation and sought justification. Water resources department officials did not respond to calls.
{{/usCountry}}The Shahpur Kandi dam is part of the Ranjit Sagar Dam (RSD) project conceived in the last 1970s. Punjab and J&K signed an agreement in 1979 to build the two projects. Though RSD was completed in March 2001, the Shahpur Kandi dam, which was to be constructed by the Punjab government, got delayed due to paucity of funds and was declared a national project in February 2008. A senior officer in the PAG office said the purpose of the review is to bring to light the important and recurrent irregularities and deficiencies. “Necessary remedial actions are required to be taken by the state government to remove the irregularities and deficiencies pointed out in the review,” he said.