Misappropriation, loss etc in Nagaland: NLA Committee ‘alarmed’ by amount involved

A Session of the 13th Nagaland Legislative Assembly in progress. The PAC 2020-2021 of the 13th Assembly presented its 124th Report to the House on February 15.  (Morung File Photo via DIPR: For representational purposes only)

A Session of the 13th Nagaland Legislative Assembly in progress. The PAC 2020-2021 of the 13th Assembly presented its 124th Report to the House on February 15. (Morung File Photo via DIPR: For representational purposes only)

Says non-submission of Utilisation Certificates a ‘major concern’

Moa Jamir 
Dimapur | March 15 

The amount involved in cases of misappropriation, loss etc. of Government’s money in the State is “alarmingly high,” the Public Account Committee (PAC) 2020-2021 of the 13th Nagaland Legislative Assembly (NLA) has observed in a recent report. 

While most of these cases are still pending, it appears that there is “a lenient approach of the Government in dealing with these cases and also in many financial areas,” the PAC headed by Advisor K Tokugha Sukhalu further noted in its 124th Report presented to the NLA on February 15. 

The 124th Report examined matters relating the Report of Comptroller & Auditor General (CAG) of India for the year 2015-2016 on ‘State Finances Audit Report’ (SFAR) and ‘Audit Report on Social, Economic, Revenue and General Sectors’.

“This inadequacy of control in the departments is a matter of serious concern which needs to be addressed immediately,” the Committee added, analyzing the cases of “misappropriation, loss, defalcations, etc” highlighted by the CAG Report.

The CAG Report was tabled in the NLA on March 28, 2017 and first taken up by the PAC (2019-2020) after which it held Oral Evidence with Departmental Representatives from August 20-22, 2019.

The current PAC (2020-2021), constituted on February 15, 2020, considered the findings and adopted the 124th Report on December 20, 2020.

‘Serious concern’

The PAC’s apparent ‘concern’ is understandable.  It was scrutinizing the status of 41 such cases involving Government’s money “amounting to Rs 597.63 crore up to March 2016, period in which final action was still pending.”

There were 17 departments in the list appended by the CAG in its 2015-2016 report. Most cases were pending for up to 5 years (39) and 5–10 years (2).  

As per Rule 20 of General Financial and Accounts Rules Part-I, the PAC report stated, “loss of public money, department revenue or receipts, stamps, stores or other property held by or on behalf of Government, caused by misappropriation, fraudulent drawal/payment or otherwise in a treasury, any other office department shall be reported immediately by the office concerned to the next higher authority as well as the Accountant General.”

Accordingly, the PAC examined why these cases had been pending for so long and whether the Government or Department is contemplating to initiate disciplinary proceedings against the defaulters? 

There were written replies from three departments in the PAC Report – Department of Irrigation, Youth Resources and Sports Department and Transport Department (Motor Vehicles). While the cases involving the first two were taken up by the State Vigilance Commission, two cases pertaining to Transport Department were pending in the Office of the District and Session Judge, Kohima and therefore, sub judice. 

No information regarding the other departments was provided in the report.  

“State is facing huge financial losses which can only be checked effectively only if the individual departments put in extra efforts to aid the State Government to meet its basic stewardship responsibilities,” it concluded. 

Non-Submission of UCs

Meanwhile, the PAC also viewed the non-submission of Utilisation Certificates (UCs) on time as a   “matter of major concern.” 

Financial Rules, according to the CAG, provide that for the grants provided for specific purposes, UCs “should be obtained by the departmental officers from the grantees and after verification, these should be forwarded to the Accountant General (Accounts & Entitlement) within 12 months from the date of their sanction unless specified otherwise.”

Evidently, it was not being followed. The CAG had then reported that out of 242 grants to 13 departments aggregating Rs 710.13 crore paid-up up to 2015-16, a total of 76 UCS or 31% for an aggregate amount of Rs 145.98 crore were in arrears ranging from 0-5 years. 

Consequently, the PAC examined, among others, the reason behind the non-submission of UCs. 

There were two written replies to the Committee - one from the Directorate of Information and  the Public Relations and the other from Higher and Technical Department (HTE). 

The former informed that the relevant UCs amounting to Rs 42.92 lakh has been submitted to the Accountant General while the latter too stated that the UC highlighted by the CAG was submitted in 2017. The HTE cited the slow progress of work for the delay. 

There were no details on the remaining 11 departments regarding the non-submission of UCs in the PAC’s Report. 

“The Committee urges all departmental officers to make effort to comply with financial rules, procedures and directives which would lead to good governance in the State,” it stated.

Postscript: Business as usual 

Despite the CAG observation as well as the PAC’s apparent ‘concerns,’ business seems to continue as usual in government departments.  

A more or less similar observation regarding cases of misappropriation, loss etc and UCs delay were made by the PAC in its 123rd Report examining the CAG’s 2014-2015 audit reports.

The latest CAG’s SFAR Report (Report No 1 of 2020) is a case in point.  It stated that there are 36 cases of misappropriation, loss etc involving Rs 218.56 crore for the year ended March 31, 2019.

While Rs 2.67 crore has been recovered, the CAG said that 36 cases involving an amount of Rs 215.89 were still pending for final action by 18 departments. Most cases (34) were pending for 0-5 years while 2 were pending for 5-10 years.  

Out of 36 cases, 26 cases involving Rs 230.06 crore were ‘awaiting departmental and criminal investigation’ while in 6 cases involving Rs 0.93 crore, it was reported that “Departmental action was initiated but not finalized.” Two cases were waiting write-off and two involving Rs 218.56 crore were “pending in the court of law.”

Meanwhile, the report further stated that “Utilization Certificates were not furnished in 187 cases involving Rs 760.72 crore since the last one to eight years.” 

“The Government needs to enforce strict compliance to the timelines of UCs by the recipients. Action against erring officials needs to be initiated,” the CAG recommended.