CAG finds grave irregularities in land allotments by YSR govt

The Comptroller and Auditor General (CAG) of India released a special report prepared on land allotments made in favour of companies and individuals by the Andhra Pradesh government during the 2006-2011 period.

CAG said these allotments were characterised by grave irregularities involving allotment in an ad-hoc, arbitrary and discretionary manner to private persons and entities at very low rates, without safeguarding the financial and socio-economic interests of the state. In a large number of cases, the state government had ignored the prescribed procedures and disregarded canons of financial propriety.

The rates proposed at different established levels of the government hierarchy were disregarded and substantial benefits were unduly granted to private parties, according to the report, which was released by the Office of the Accountant General of Andhra Pradesh on Thursday.

Interestingly, most of the major irregularities as mentioned in the report happened when YS Rajasekhara Reddy was the chief minister. Also, most of these instances have already been the subject of various ongoing investigations undertaken by the Central Bureau of Investigation (CBI), including the disproportionate assets and quid-pro-quo investments case being pursued against his son and YSR Congress president YS Jagan Mohan Reddy.

The report has been placed in the state Legislative Assembly on the last day of the budget session on Thursday.

During the period under review, the state government alienated a total of 88,492 acre of government land in favour of 1,027 beneficiaries for various purposes. Audit scrutiny in the test-checked cases revealed that an undue benefit of Rs 1,786 crore was given to various entities and persons due to the difference in the rates at which land was allotted and the market value as recommended by the district collector or the empowered committee, the report said.

SOME 'MAJOR IRREGULARITIES'

* 3,115 acre of land allotted to Brahmani Industries Limited owned by former Karnataka minister Gali Janardan Reddy in Kadapa district for setting up a commercial airport and flying academy in violation of Government of India's policy

* 10,760 acre of land allotted in the same area for Brahmani Industries Limited for establishing a green field integrated steel plant involving illegal alienation of 674 acre of water bodies and allocation of two TMC of water without environmental clearance

* 8,844 acre of land allotted to Lepakshi Knowledge Hub Limited (LKH) even before the creation of infrastructure by the developer. LKH did not establish any industry or created any employment but had mortgaged 4,397 acre of allotted land for obtaining loans of Rs 790 crore from banks

* Allotment of 413 acre of land to Obulapuram Mining Company owned by former Karnataka minister Gali Janardan Reddy in Anantapur district.

* Process of agreement with Vanpic (Vadarevu and Nizampatnam Port and Industrial Corridor) and alienation of land to the company lacked legitimacy and transparency

* Allotment of land to Indu Tech Zone Private Limited and Brahmani Infratech Private Limited, Stargaze Properties Private Limited (250 acres each) in Hyderabad for establishing IT SEZs.

* Land allotted to Simhapuri Energy and Vikas Power Limited in Nellore district

According to the report, the audit scrutiny has been conducted in 11 sampled districts in which the state government reportedly alienated 50,285 acre of land to 459 persons/institutions/departments. These districts are Anantapur, Guntur, Hyderabad, Krishna, Mahabubnagar, SPS Nellore, Ranga Reddy, Srikakulam, Vizianagaram, Warangal and YSR Kadapa.

The report also held that over 33,000 acre of government land allotted through Andhra Pradesh Industrial Infrastructure Corporation (APIIC) for industrial development during the period has not yielded the expected results as the state nodal agency could not provide the required thrust towards targeted industrialisation of the state and failed to monitor effectively the end uses, causing considerable loss to government exchequer.

Coming down heavily on the performance of special economic zones (SEZs), the report stated that although hundreds of acres of land were transferred for creation of SEZs, the objective of these allotments remained unachieved.