Security deposit returned to contractor before completion of housing scheme
A report prepared by the State Performance Audit Officer on the delay in constructing a 12-storey housing tower at Thuruthy in West Kochi for landless beneficiaries in the area, holds the Mayor, Additional Secretary, and the Superintending Engineer of the Kochi Corporation accountable for having violated rules and returned the security deposit to the contractor before completion of work.
The Additional Secretary had then been holding the Secretary’s charge and had approved the return of the deposit after the Mayor had given her assent, according to the report.
The corporation must take time-bound action to retrieve the deposit from the contractor, and till then, it remains the joint liability of the Mayor, Additional Secretary, and the Superintending Engineer, the report says.
The construction of two such towers for 398 families initiated under the previous UPA government’s Rajiv Awas Yojana (RAY) has remained stalled for nearly three years now. The report says that 29 councillors had submitted a complaint on the matter before the Minister for Local Self-Governments, after which the audit officer had investigated it in October last year. A few Opposition councillors in the corporation had recently procured a copy of the report.
After the security deposit of ₹91.22 lakh was returned to the contractor in June last year with the Mayor’s anticipatory approval, Opposition councillors have, since then, consistently disputed the return of the deposit without the council’s approval. When the issue was brought up again before the council at a meeting last month, it was put to vote and passed with the UDF’s majority in the council, Mayor Soumini Jain said.
“Anticipatory approval can be granted by the Mayor in emergency situations, according to rules. The contractor wrote to us, saying he had no more money to spend and required the security deposit to prevent the work from coming to a halt. This letter was sent to the finance standing committee, where it was not opposed,” Ms. Jain said. While she has not seen a copy of the report, in this matter of social importance, she is willing to be held liable, she added.
While payment worth around ₹10 crore had been made to the contractor, a site inspection revealed that only the ground floor and parts of the first floor were constructed, the report says. The cost of work done has not yet been precisely assessed, but preliminary estimates suggest that the expense could be disproportionate to the structure on ground, the report notes.
Further, the shortcomings in the DPR that was sanctioned in 2014 are to blame for the long delay in implementing the project, the report says. After several estimates were found missing from the DPR, a revised estimate had to be prepared, taking the cost of the tower up by around ₹21 crore, an amount that will now be funded by Cochin Smart Mission Limited, Ms. Jain said. The work can resume only after the matter is presented before the council at the next meeting, she added.
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