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CAG Raps 3 J&K Depts Over Improper Planning, Undisbursed Funds

by Press Trust of India
March 29, 2021
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Jammu: There was an increase in accumulated balances in 1,138 bank accounts of three departments in Jammu and Kashmir between 2014 and 2019 due to factors such as improper planning and undisbursed funds for relief or compensation to victims of militancy and natural disasters, the CAG has said.

It is recommended that there is an effective monitoring mechanism in the union territory in this regard and government instructions are strictly implemented, it said in a report tabled in Parliament recently.

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The massive increase in balances were in accounts of 131 Drawing and Disbursing Officers (DDOs) of the public works, revenue and rural development departments, the Comptroller and Auditor General (CAG) of India said.

The CAG made the remarks in its Jammu and Kashmir report on the social, general, economic and revenue for the year ended March 31, 2019.

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The increase in the accumulated balances was due to undisbursed funds of relief or compensation to the victims of militancy and natural disasters, improper planning and non-completion of schemes, overstatement of expenditure in utilisation certificates, retention of funds, retention of statutory deductions and land compensation outside the government account, the CAG said.

It said that instructions issued by the government from time to time on consolidation and streamlining of utilisation of funds retained in bank accounts of DDOs were not strictly adhered to.

“Only a meagre amount of Rs 64.10 crore was transferred from the redundant bank accounts of DDOs during the period December 2016 to February 2017,” the report said.

“The accumulated balance in 1,138 bank accounts of 131 DDOs of three selected government departments (public works, revenue and rural development) increased from Rs 116.41 crore to Rs 399.94 crore during the period from 2014 to 2019,” it said.

The report said the compliance audit on management of bank accounts in government departments was conducted from February 2019 to February 2020 to assess whether rules and procedures relating to financial matters as well as the circulars or instructions issued by the finance department have been complied with by the DDOs.

“Emphasis was given to assess the compliance by the DDOs to the government instructions of December 9, 2016, regarding consolidation of and reduction in number of bank accounts in government departments. Test-check of records was conducted in 131 DDOs selected on a random basis, of three departments in six out of 22 districts of the (erstwhile) state,” it said.

The state of Jammu and Kashmir in 2019 became a union territory after its special status was revoked the Centre. The erstwhile state was bifurcated into union territories of Jammu and Kashmir and Ladakh.

The test check of records, the report said, was conducted in Jammu, Reasi and Rajouri districts of the Jammu Division and Anantnag, Baramulla and Kargil districts in the Kashmir division.

Kargil is now part of union territory Ladakh after bifurcation of the erstwhile state.

“The audit scrutiny of the records (February 2019 to February 2020) of 131 DDOs of three selected departments in six districts revealed accumulation of undisbursed/unutilised balance in 1,138 bank accounts operated at the end of each financial year during the period from 2014-15 to 2018-19,” the CAG said.

“The cumulative balance of 131 DDOs as on 31 March 2015 was Rs 116.41 crore in 1,138 bank accounts, which increased to Rs 399.94 crore at the end of March 2019,” it said.

The report said the audit also noticed that in the three departments, 44 DDOs had opened 182 bank accounts in banks other than the J&K Bank Limited without obtaining prior approval of the finance department.

The CAG also highlighted the non-compliance of instructions including transfer of cash balance of all government accounts which had remained inoperative for more than a year to official account of the finance secretary without closure of the bank accounts.

It recommended the finance department to ensure strict implementation of the government instructions issued for streamlining of retention of funds in bank accounts. There should also be an effective monitoring mechanism so that funds are not withdrawn by DDOs from the treasury in anticipation of immediate disbursement to avoid accumulation of undisbursed balance in the bank accounts, the CAG said.

 

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