CAG pulls up MoEF for favouring R-Power, JP

Against receivable forest land of 1,03,381.91 hectares, only 27%, or 28,086 hectares, were received during 2006-2012

A Comptroller and Auditor General of India (CAG) report on Friday criticised the ministry of environment and forests (MoEF) for allegedly favouring companies such as Reliance Power and JP Associates regarding diversion of forest land.

Against the receivable forest land of 1,03,381.91 hectares, only 27 per cent, or 28,086 hectares, were received during 2006-2012, the report said.

The auditor pulled up the ministry for clearance to Reliance Power’s Sasan project in 2007-08 on the basis of an inappropriate certificate by the chief secretary of Madhya Pradesh, alleging MoEF had “inexplicably overlooked the deficiencies in the certificate”.

According to the report, the chief secretary had issued a certificate of non-availability of non-forest land in Sidhi district, instead of a certificate of non-availability of non-forest land for the entire state. “Based on this ineligible certificate, the ministry exempted Sasan Power from providing non-forest land of 1,384.96 hectares in case of the ultra-mega power project and the coal mining project,” it said.

The 3,960 Mw pit-head coal-based power plant reportedly cost about Rs 20,000 crore.

“The observations of the CAG regarding exemption given to Sasan Power project from acquiring non-forest land for compensatory afforestation are misplaced and bereft of facts. According to the bidding conditions of the project and the power purchase agreement signed with procurers, the responsibility for acquiring land for the project and the mines is that of the state government where the project is being executed,” said a Reliance Power spokesperson said. He added any increase in the cost incurred on acquiring non-forest land for compensatory afforestation would have increased the cost of the project which, in line with the bidding conditions, had to be borne by power procurers from various states. “This would have led to higher rates for the power generated from the Sasan UMPP (ultra mega power project), which would eventually be borne by the consumer,” he added.

The report also cited favours to JP Associates for a cement plant in the Sonbhadra district of Uttar Pradesh, where the state government had changed the status of 1083.23 hectares of forest land into revenue land.

Between 2006 and 2012, compensatory afforestation funds with ad-hoc Compensatory Afforestation Fund Management and Planning Authority (Campa) increased from Rs 1,200 crore to Rs 23,608 crore.

The report said encroachment on 1,55,169.82 hectares of forest land was recorded, according to information furnished by six states---Andhra Pradesh, Arunachal Pradesh, Assam, Punjab, Uttarakhand and West Bengal. CAG criticised the MoEF and states for not making any time-bound programme for eviction of the encroachments.

The report said Campa was ineffective in ensuring complete and timely transfer of all the money collected by states and Union territories. The variation in data of the transfer of funds available with Campa and that collected from states/Union territories was Rs 6,021.88 crore, 26.32 per cent of the principal amount with Campa. “Non-reconciliation of this over years not only indicates laxity in controls, but also raises doubts on the reliability and completeness of the data provided by all the agencies concerned,” the report said.

It stated of the Rs 2,925.65-crore compensatory afforestation funds released by Campa during 2009-12, only Rs 1,775.84 crore was utilised by states and Union territories.