CAG draws flak from Aviation Ministry

Ministry of Civil Aviation on Friday strongly refuted the allegations and the loss figures arrived at by the Comptroller and Auditor General (CAG) in its report on the Indira Gandhi International Airport (IGIA) that was tabled in Parliament.

In an official statement issued here, the Ministry said the calculation of presumptive gain from the commercial use of land at the Delhi Airport was totally erroneous and misleading as it simply added the nominal value of the projected revenue without taking the net present value. In fact, the net present value of the figure quoted by CAG was Rs.13,795 crore only. CAG had further failed to appreciate that 46 per cent of this amount would be payable to AAI as revenue share, the statement added.

The statement pointed out that the levy of Development Fee was under Section 22 (A) of AAI Act, 1994, and was in the knowledge of all the bidders prior to the bidding process. Hence, contrary to what the CAG had said, the levy of Development Fee by DIAL (Delhi International Airport Ltd.) was not a post-contractual benefit provided to DIAL at the cost of passengers.

On the issue of lease of Airport land, it clarified that the land had not been given to DIAL on rental basis, and the Rs.100 was just a token amount for the purpose of the Conveyance Deed. The determining factor for grant of concession to the bidder was the gross revenue share quoted by the bidders. As a result, Airports Authority of India (AAI) now received 45.99 per cent share of gross revenues of DIAL and 26 per cent of all dividends. Benefit to AAI was likely to be more than Rs.3 lakh crore in this process during the entire concession period, it said. AAI had already got its revenue share of Rs.2,936 crore in the last 6 years, and likely to get Rs.1,770 crore in 2012-13 and Rs.2,287 crore in 2013-14.

It said all aeronautical and Airport assets created by DIAL would be transferred back to AAI as per agreement at the end of the concession period. It said the views of Ministry of Civil Aviation and AAI had not been incorporated in the final report of the CAG.