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The Jammu & Kashmir administration has recommended a CBI probe into the allegations of malpractices in awarding contracts of an insurance scheme for the State government employees and a civil work in the Kiru hydroelectric power project to private firms, according to a source.
The authorities concerned had sought reports in these matters from the Finance Department, Power Development Department and the Anti-Corruption Bureau. Based on the preliminary findings, they were referred to the CBI.
Incidentally, in October last year, Meghalaya Governor Satya Pal Malik had made bribery allegations pertaining to his tenure as the Governor of J&K.
According to the J&K administration’s findings, the first issue pertains to the health insurance scheme for the government employees. Following the expiry of the previous policy scheme for the gazetted employees in 2017, the then State government had proposed another scheme for ₹6 lakh per annum for both gazetted and non–gazetted employees, apart from pensioners. Unlike in the past, the new scheme was made mandatory for all to subscribe.
The process for selecting an insurer was started in February 2017 and a consultant was roped in through a competitive bidding. With the consultant’s help, another notice–inviting tender was floated in June 2018 and the new insurer was selected via competitive bidding. An insurance of ₹6 lakh per annum per employee/pensioner on a premium of ₹8,777 (employees) and ₹22,291 (pensioners) was finalised. “The allegations primarily relate to process/rates,” said the government source.
The Kiru Hydroelectricity project is expected to generate 624 MW of energy in a 90% dependable year. As alleged, the board of directors in their 47th meeting on June 28, 2019, had decided that the proposal based on “paper tendering process” to award the contracts be cancelled in favour of “e-tendering”. However, in the next meeting held in August 2019, the board reversed the decision and awarded the contract.
It is alleged the Detailed Project Report was approved by the authorities on June 13, 2016, at a cost of ₹4,640.88 crore, which was later revised upwards to ₹4,708.60 crore with permission. The amount was reduced to ₹4,287.59 crore after considering exemptions by the then J&K government. Of the sum, ₹1,166.31 crore was for land acquisition, building, communication, establishment and other related works.
With respect to the rest, the difference between the sanctioned cost of ₹3,121.28 crore and the actual of ₹2,994.89 crore was ₹126.39 crore. “Thus, the awarded cost was less than the sanctioned cost by 4%...if the land acquisition cost is added to it, the gross awarded cost of the contract comes to ₹4,135.64 crore. Therefore, the final difference between the awarded cost and sanctioned cost is ₹151.95 crore, which is less by 3.5%,” said the source.
However, it is alleged the main contractor — who was awarded 75% of the project — won the contract at a cost of 7.45% above the sanctioned one. “The overall reduction in the cost came because the other two contractors had quoted a price significantly lower than the sanctioned cost,” the source said.
