Thiruvananthapuram: The Controller and Audit General (CAG) has found irregularities in awarding contracts to the Uralungal Labour Contract Cooperative Society (ULCCS) without inviting open tenders. The CAG in its report said that five contracts worth `809.93 crore were awarded to ULCCS without tendering at the estimated rate.
The Central Vigilance Commission (CVC) has reiterated that tendering process or public auction is a basic requirement by any government agency. Any other method, especially award of contract on nomination basis, would amount to a breach of article 14 of the Constitution. As per the Kerala financial code, while giving a work on contract, the general principles governing invitation to tender should be followed. Further, the Supreme Court emphasized that the award of the government contract should be through public auction or public tender.
The government issued guidelines for selecting accredited agencies for execution of public works in July 2014 and August 2015. As per the guidelines for selection of accredited agencies, the maximum value of a single work to ULCCS was `25 crore. The maximum quantity of work in hand at a time that could be held by the society was `250 crore.
However, even the smallest of the work entrusted was worth Rs 51.42 crore, said the report. The maximum quantity of work in hand was worth `809. 93 crore. This violated the guidelines issued by the government, the CAG said.
In the exit meeting, PWD special secretary stated that the work was entrusted based on a cabinet decision in which the guidelines of the financial department were not considered.
The audit observed that the committee on public account had disapproved of the practice of nominating an agency to entrust a work. It reiterated that the department should resort to more transparent tendering procedure for awarding any work. As the department did not adhere to the guidelines issued by the CVC, government and Supreme Court’s direction on awarding contract, an inquiry should be initiated by the government to fix responsibility, said the report.