Covid centres irregularities: Oxygen supplied to BMC at highly inflated rates, says ED

The Enforcement Directorate's investigation into alleged irregularities in Mumbai's jumbo Covid centres has revealed inflated prices for oxygen supply contracts. The agency is examining contracts as part of its probe into the BMC's pandemic-related expenditure. The contractor allegedly supplied oxygen at 50-60% higher rates than the actual price, causing a potential loss to the civic body. The agency is also investigating if profits were shared with individuals claiming political influence. The ED case began with an FIR against Lifeline Hospital Management Services.

Jumbo covid centres irregularities

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Mumbai: The Enforcement Directorate’s investigation into the alleged irregularities in jumbo Covid centres run by the Brihanmumbai Municipal Corporation (BMC) has revealed that a contractor had supplied oxygen to the civic body at an inflated rate of 50% to 60% than the actual price.

The agency is examining the contracts along with several others as part of its probe related to BMC’s expenditure of around ₹4,000 crore on pandemic-related contracts on suspicions they were inflated and involved ineligible vendors and may have caused a loss to the civic body.

The two oxygen-supply contracts under the ED scanner were worth ₹140 crore, sources said, adding, “In the two contracts related to oxygen supply to Covid centres and other treatment facilities, worth ₹140 crore, it is being verified if the vendor had spent only around 40% of the total costs while the rest, between 50% to 60%, was kept as profit.”

The contractor had allegedly procured the oxygen from another Delhi-based supplier and the agency is examining the vendor’s claims of non-involvement in any wrongdoing in the contracts, sources added.

The agency has so far carried out searches at several locations connected to civic suppliers and recorded the statements of main as well as secondary vendors to determine the actual costs incurred in contracts, sources said. “Irregularities, including instances of inflated contracts, have been noticed during questioning of several vendors and examination of supply-expenditure records in the probe so far related to the total expenditure on pandemic-related contracts,” sources added.

The agency is also verifying if a substantial percentage of the profits were shared with persons, including middlemen, claiming to have political influence and seeking payment of consultancy charges. “The probe is trying to establish the end-beneficiaries of the proceeds from the profits gained,” sources said, adding that another contractor under the scanner had supplied beds, among other articles, for Covid centres.

In June, the ED had asked the BMC to provide details on the Covid-related contracts. The step was taken after the ED found alleged irregularities across the board, from the award of contracts to the purchase of medicines and body bags at inflated rates to arranging accommodation for personnel.

The ED case began with an FIR registered in August 2022 against the partners of Lifeline Hospital Management Services, which bagged a ₹38-crore bid to set up two jumbo Covid centres at Dahisar and Worli. According to the FIR, the company allegedly submitted forged documents to the BMC and had neither adequate staff nor experience in providing manpower at a medical facility. It was also alleged that the firm was unregistered.