The district administration had served the show cause notice to the gram panchayats four days ago and had given them 15 days time to reply as to why they could not spend the funds for implementing the Centre's flagship poverty alleviation project, official sources said.
"The administration has resolved to expedite the completion of pending projects. Those found negligent in executing the work would be taken to task. The errant officials and sarpanches are being penalised," Kendrapara Collector Niranjan Nayak said.
The implementation of the flagship project was left much to be desired in the entire district with 230 gram panchayats where only 50 per cent of funds allocated for 2012-2013 financial year could be spent.
An estimated Rs 8.81 crore was lying unspent during the current fiscal, the sources said.
"That is why, there is every possibility of central allocation being stopped towards Kendrapara district as utilisation certificates of sixty per cent of the projects are yet to be submitted", an official said.
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