CAG report flags diversion of Rs 3.21 crore
Source: The Sangai Express

Imphal, September 18 2026: The CAG Report for the year ended Mar 31, 2024 has flagged alleged diversion of Rs 3.21 crore for unauthorised works, recommending the State Government to investigate the case and fix responsibility on officials involved.

The CAG report, which was tabled in the State Assembly recently, said the alleged diversion of Rs 3.21 crore was found during the scrutiny of records (March-April 2022) of the then Office of the Executive Engineer, Imphal East Division, PWD .

Between September 2020 and January 2022, 140 Cheque Drawal Authorities (CDAs) amounting to 46.03 crore were issued for payment to various contractors for execution of 289 civil works.

However, audit observed that out of the sanctioned Rs 46.03 crore, Rs 3.21 crore had not been paid to the intended contractors.

Instead, this amount had been disbursed to four other contractors for 150 works, which were not sanctioned or approved, said the report.

The report said that there were no records of tender notices being issued or work orders being generated for any of the 150 works.

Notably, 141 out of the 150 works worth Rs 2.93 crore were awarded and paid to a contractor who was a near relative of the then Engineer-in-charge, in violation of General Conditions of Contract (GCC), 2020, said the report.

The CAG report further rejected a State Government justification that the works had been carried out in an emergent manner during the Covid pandemic by diverting funds from available works as Emergency case on setting up of Covid care centres in Imphal East by resorting to restricted tender.

"The reply of the State Government is not acceptable as the audit observation pertained to irregular payment for unauthorised works which were not of emergent nature related to Covid pandemic.

Moreover, audit observed that works claimed to have been executed during the Covid pandemic were not found in the list of 150 unauthorised works pointed out by audit," said the report.

It recommended that the State Government may investigate the diversion of Rs 3.21 crore to unauthorised works and fix responsibility on officials involved for irregular payments.

It asked the Government to ensure strict adherence to CPWD Works Manual provisions and the Manipur PWD General Conditions of Contract to prevent conflict of interest and unauthorised payments.

Meanwhile, the office of the Accountant General (Audit) has issued a clarification stating that an audit report regarding "undue benefit to contractor" resulting in "excess payment" of over Rs 61 lakh--which was published by this paper on September 13--was in fact included and published in the CAG Report and laid before the State Legislative Assembly on September 2 .

Notably, the project in which the CAG had flagged excess payment of Rs 61.73 lakh to a contractor pertains to improvement of the State Guest House at Babupara Imphal.

On September 13, citing sources, this paper had reported that no actions were taken by relevant authorities to include a draft prepared by the Principal Accountant General (Audit) flagging inflated work volume and excess payment in the CAR Report.

Meanwhile, documents provided by the office of the Accountant General (Audit) to this paper have now revealed that the draft had indeed been included in the CAG Report for the year ended March 31, 2024 .

How excess payment of Rs 61.73 lakh was made

The work "Major Improvement of State Guest House, Babupara, Imphal (Phase-II)" for construction of protection wall and compound wall on the eastern side was awarded to a Special Class Contractor on June 6, 2019 .

The project, the work order of which was issued with a tender amount of Rs 1.43 crore was completed on June 1, 2020 at a cost of Rs 1.52 crore.

The volume of work was allegedly inflated for two components--"earthwork in excavation" and "laying cement concrete" .

Earthwork excavation
The actual physical measurement of the length of the eastern boundary of the Guest House is 106.50 m .

However, the estimate in the Measurement Book provided for 45 units of excavation, each of 110.51 m-- resulting in an inflated excavation length of 4,972.95 metres, over 44 times the actual physical boundary length.

This resulted in the inflation of the cost from Rs 40,464 (actual) to a staggering Rs 18,89,446--meaning Rs 18,48,979 was paid in excess.

Laying of cement concrete
The quantum of work was recorded as 620.68 cum instead of 12.78 cum, the actual requirement.

This resulted in the inflation of the cost from Rs 1,29,498 (actual cost) to a staggering Rs 44,13,100--meaning Rs 43,24,066 was paid in excess.

Total paid in excess
While the actual cost of the two components combined is Rs 1,29,498 only, the contractor has been paid Rs 63,02,546--- an excess of Rs 61,73,045 .

Giving its recommendations, the CAG said the State Government may recover the excess payment of Rs 61.73 lakh from the contractor without delay, and fix accountability on officials responsible for preparing the inflated estimate, recording fictitious MB entries and certifying irregular payments.

The CAG also gave its recommendation for the State to conduct a special audit of similar works under PWD to detect and rectify other cases of inflated or fictitious billing.

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