UNDUE FAVOURS were made by the Department of Information Technology as payment of service tax to the Society for Promotion of Information Technology (SPIC) that manages e-sampark centres in Chandigarh. This was pointed out in the audit conducted by the office of the Principal Director of Audit (Central) Chandigarh.
The audit report (2016-17) specified that as per the clause contained in the bid document or the quotation submitted by initial service providers or invoices raised by them prior to handing charge to SPIC, the rate quoted per transaction was inclusive of any kind of duties, charges, taxes levied applicable.
“During the scrutiny of relevant vouchers pertaining to the expenditure made by the Department of Information Technology, UT, it was found that the department paid Rs 2,07,91,248 in the form of service tax as claimed by SPIC in its invoices raised against the service provided by SPIC per month. The payment made by the department to SPIC in the name of service tax in addition to the per transaction rate is irregular and unjustified,” the audit stated.
There are 40 e-sampark centres in Chandigarh. In 2001, the administration had launched the e-sampark project and tenders were invited. To run the urban sampark centres, the IT department accepted the bid given by Star SQL International Ltd while the work to operate rural sampark centres was allocated to a company, Datamations. An agreement was signed on December 15, 2006. Both firms continued their services till December 31, 2010. Thereafter, the work of operating the sampark centres was given to SPIC for six months on the same terms and conditions.
The department was required to invite tenders. However, a new service provider could not be appointed due to which responsibility was given to SPIC that continued to be extended by six months at regular intervals. According to the scope of work defined in the bid documents, based on which the department made a legal agreement with the other two companies, the utility bills in respect of urban and rural sampark centres were to be paid by respective operating agencies. A similar operation was transferred to SPIC in 2011 on the same terms and conditions.
The report also specified that vacant bays in the EDC building led to a revenue loss of Rs 5.17 crore.
Chandigarh Administration constructed a building entrepreneur development centre (EDC) at Rajiv Gandhi Chandigarh Technology Park at a cost of Rs 18.71 crore. The EDC building, which has 19 bays, was taken over by the IT department on February 27, 2012. These bays were designed with state-of-art facilities and provisions to draw entrepreneurs towards the IT Park. The audit also found that during the scrutiny of records at the IT department, all the bays remained vacant from February 27, 2012 to May 2013. From August 2012, the IT department started releasing ads for allotment of space and accordingly, the IT companies responded and the DIT rented the bays as per requirement.
“It has been noticed that 7 bays for SMEs remained vacant throughout starting from February 2012 till March 2017. The occupancy of bays in the EDC building also began to decline from 2012-13 to 2016-17. This resulted in a loss of Rs 5.17 crore,” said the report.
The audit found that even as some bays were rented out to SPIC, there were no records.
“During the scrutiny of records pertaining to the IT Department’s office, it was found that on the basis of approval, bays 1, 2, 3, 4,5 with an area of 3,996 sq feet, were allotted to SPIC. But the audit found that the department could not produce the rent agreement/lease deed on the basis of which allotment was made. Had such allotments been made to some firm or company, it would have been paid the minimum rate of Rs 40 per sq feet per month. Not entering into a legal agreement led to the department losing Rs 6.39 lakh,” the report maintained.
SDM Arjun Sharma, head of the IT Department, asserted that every payment was made in consonance with the terms and conditions and no unaccounted money was released to SPIC.