Airports Authority of India incurred Rs 70 crore losses, says CAG report

AAI suffered a loss of Rs 41.68 cr due to lack of appropriate action at Kolkata airport

The Airports Authority of India (AAI) incurred over Rs 70 crore loss, partly due to non-inclusion of certain portion of land in relation to lease agreement for the Delhi airport, CAG said on Tuesday.

The top auditor said AAI suffered a loss of Rs 41.68 crore due to lack of appropriate action and undue benefit extended to a contractor for advertising sites at the Kolkata airport.

In a report tabled in Parliament, the Comptroller and Auditor General (CAG) said AAI "sustained a loss of Rs 28.67 crore" with respect to non-inclusion of land in a lease agreement related to the Delhi airport.

AAI, in April 2007, had allotted a built-up space at Bijwasan to Delhi International Airport Ltd (DIAL) for the purpose of providing dormitory accommodation for CISF personnel deployed at the airport here.

"While signing the agreement, AAI did not include in the lease agreement (March 2008) the area of land along with the built-up space and the lease rent payable for the same," CAG said.

The report said that after CAG pointed out the issue in its audit in July 2014, AAI raised the invoices for lease rent towards land measuring 19,525 square metres in January 2015.

"However, DIAL refused payment on the ground that there was no agreement to charge rent for such land. Thus, AAI sustained loss of Rs 28.67 crore," it noted.

DIAL, where diversified GMR group and AAI are among the joint venture partners, is operating the international airport in the national capital.

Flagging another issue, the apex auditor said AAI extended continued undue benefits to TDI International India Ltd, which had a licence for indoor and outdoor advertisements at Netaji Subhas Chandra Bose International Airport in Kolkata.

"Deferred payment facilities were allowed for a year, contract period was extended even as the licensee initiated a dispute on payment and dues amounting to Rs 23.43 crore for the contract period (October 2007 to October 2014) remained unrealised," the report said.

Even after the contract period ended, the report said AAI did not use a notice for vacating the sites leading to TDI using the sites for another 14 months — October 2014 to December 2015.

This resulted in revenue loss of Rs 41.68 crore to AAI as "TDI did not acknowledge any dues in the absence of a contractual obligation", it added.

The conclusions are part of CAG's report for the year ended March 2016 related to 'Union Government (Commercial) Compliance Audit Observations'.

Further, the auditor said AAI did not carry out a realistic assessment of civil enclave requirements at Jaisalmer and Bikaner (Rajasthan) and Bhatinda (Punjab) due to which Rs 100.59 crore on creation of facilities at these places remained idle.

"AAI also incurred a recurring loss in the form of depreciation charges amounting to Rs 40.06 crore," it added.