Environment and Forest Department allowed contractors to do the task at “simple royalty”

The Environment and Forest Department of Assam allowed contractors of the National Highway Authority of India (NHAI) to extract sand, stones and boulders in the State at “simple royalty” despite NHAI issuing work orders to its contractors allowing price of these forest produce at much higher rates at source for various segments of the ongoing East West Corridor project in the State.

Revealing this a report of the Comptroller and Auditor General (CAG) has stated that such “irregular and unjust” decision of the department would not only cause loss of revenue to the tune of Rs. 844 crore, it would also extend undue gain of the same amount to NHAI contractors.

The report laid on the floor of the Assam Assembly here on Thursday revealed that NHAI issued work order to its contractors for supply of 171.21 lakh cubic metres (cum) of stone/boulders with average rates at source fixed at Rs. 520/cum and 77.71 lakh cum sand at average rate of Rs. 275/cum. Against the rates mentioned in the NHAI work orders, the simple royalty rates fixed by the Environment and Forest Department were Rs. 100/130 per cum of stone and boulders and Rs. 70/90 per cum of sand. Thus the rates in NHAI work orders were higher by Rs. 420/390 per cum in respect of stone and boulders and by Rs. 205/185 per cum in respect of sand. This would result in total loss of revenue to the tune Rs. 844 crore (Rs. 693 crore in respect of stones and boulders and Rs. 151 crore in respect of sand), revealed the CAG report.

The CAG authorities have recommended to the Assam government to investigate the matter as to how NHAI contractors were allowed extraction of sand, stone, boulder etc, at simple royalty despite the availability of the details of the rates at which work orders were issued to the contractors. It also asked the government to explore the possibility of recovering differential royalty from NHAI contractors in the interest of State revenue.

CAG authorities noticed that in four test-checked forest divisions of Cachar, Kamrup East, Nagaon and North Kamrup, the Environment and Forest Department allowed extraction of 3.31 lakh cum of sand and 20.84 lakh cum of stone between 2006-07 and 2010-2011.

The total length of the East West Corridor project in Assam is 670 km of which NHAI has been entrusted to construct 639 km. The project is expected to be completed by December 2014.

The CAG has recommended that the Assam government issue necessary orders to the forest divisions for collecting royalty at par with those at which NHAI has issued work orders to the contractors to arrest further loss of government revenue.