Haryana seeks CAG audit into Rapid Metro; IL&FS offers to run service till Oct 16Updated: Sep 18, 2019 21:05 IST
The Haryana government, on Wednesday, approached the Punjab and Haryana High Court (HC) seeking appointment of the Comptroller and Auditor General (CAG) of India for conducting a forensic audit of the Rapid Metro’s finances. The high court has adjourned the matter till Friday, when it is expected to pronounce a decision on the request by the Haryana government.
The court also heard a proposal by IL&FS, according to which the company has offered to continue running the service until October 16. An email detailing the terms of this proposal was also sent to the chief administrator, Haryana Shahari Vikas Pradhikaran (HSVP), by IL&FS Rail on Tuesday evening.
The IL&FS had floated the Rapid Metro Gurugram Limited (RMGL) and Rapid Metro Gurugram South Limited (RMGSL), two special purpose vehicles, which have been running the service since 2013 and 2017, respectively.
“RMGL/RMGSL will continue to operate their Metro Link for a period of 30 days (i.e. until October 16, 2019) during which (a) the ‘debt due’ as per financing documents in terms of the concession agreement may be determined by an auditor appointed by the Hon’ble Court; and (b) the process for transfer of the Metro Links may be undertaken under the supervision of two Hon’ble (retired) High Court judges,” reads IL&FS’s email to the Haryana government, a copy of which is with the Hindustan Times.
This proposal, however, has been made subject to “an undertaking from the HSVP that once the debt due is determined by the auditor appointed by the Hon’ble Court at least 80% of the ‘debt due’ so determined shall be deposited in the escrow account.”
According to the original contract between the two parties, the minimum amount to be paid by the Haryana government (in case of breach of contract by either party) is 80% of the total debt accrued by the project.
“This is the first time that any such a proposal to continue running the service has been made by the IL&FS. We will consider the proposal and give our official response to it on Friday before the court,” said Chetan Mittal, advocate for the HSVP and the Haryana Mass Rapid Transport Corporation.
Mittal also said, “The CAG is the most appropriate authority to conduct a forensic audit of the Metro service as it has the authority to also follow up on the Enforcement Directorate’s investigation into allegations of money laundering within the firm. We hope the court will allow for the same.”
The IL&FS declined to provide an official comment on the matter.
First Published: Sep 18, 2019 21:05 IST