Rs 8000 cr loot: Clamour for action grows

The Aam Aadmi Party (AAP) that has been crying itself hoarse on private distribution companies inflating their dues stands vindicated.

In a draft CAG report published on Tuesday, the Comptroller and Auditor General has said that the <g data-gr-id="120">discoms</g> have inflated their dues to the tune of almost Rs 8,000 crore, questioning the conduct of power regulator DERC (Delhi Electricity Regulatory Commission) and those government nominees on board of <g data-gr-id="121">discoms</g> who have encouraged and turned a blind eye to the misdeeds of the <g data-gr-id="122">discoms</g> who have manipulated consumer figures, bought costly power, suppressed revenue and have regularly given undue favours to group firms.

The report has created a political storm with the AAP mulling the option to move High Court demanding the CAG report on the Capital’s power discoms to be made public. The Bharatiya Janata Party (BJP) on the other hand, has demanded a CBI probe into the matter.

“The Delhi government should take steps so that the CAG report is made public at the earliest as whatever is known today is only through media reports. It should initiate <g data-gr-id="99">criminal</g> investigation in the case, prosecute the guilty and recover the public money,” AAP spokesperson Deepak Bajpai said during a press conference.

Lashing out at the discoms, AAP Delhi unit secretary Saurabh Bharadwaj claimed, “BSES Yamuna Power Limited (BYPL) duped the people of Delhi by Rs 1,062 crore, BSES Rajdhani Power Limited (BRPL) of Rs 860 crore and Tata Power-DLL (TPDDL) of Rs 1,098 core.”

He also attacked the erstwhile Sheila Dikshit government and the BJP over the issue.

Meanwhile, Delhi Chief Minister Arvind Kejriwal said the Capital may see “further cuts” in power tariff if the Centre gives his government the authority to “cancel” the existing power purchase agreements with electricity generating companies, entered into by the Sheila Dikshit dispensation.

The report also raises questions over the conduct of DERC and government nominees on the board of the three discoms.

The report accuses the Reliance-led discoms of “uneconomical and inefficient operations”, leading to operational losses and negative net worth. These resulted in their low credit ratings.

In the dock are two Anil Ambani group controlled discoms, BRPL and BYPL, who according to the report, acquired material and services worth Rs 1,428 crore from their sister company Reliance Energy Ltd (REL) but without the approval of the board of directors of the two discoms.

The CAG report said that in one case the REL itself conducted the tendering process, became a bidder before declaring itself the winner, thereby leading to <g data-gr-id="90">serious</g> question of conflict of interest.

“Due to low credit ratings, BRPL and BYPL availed loans at higher interest rates. BRPL and BYPL did not declare dividend or bonus shares, however, TPDDL declared <g data-gr-id="76">dividend</g> and also issued bonus shares,” the report adds.

Meters procured by REL from Kaifa Technology Ltd, China in March 2004 was at Rs 699 per meter, but the BRPL stated the cost of procurement of the same meters from the REL in 2005 at the rate of Rs 1080 per meter. BRPL had purchased 6.43 lakh of these meters.

Another startling revelation is made involving Tata group’s TPDDL, which, the report says, paid at least Rs 93.50 crore to its own power generation plant in Rithala as fixed charges without supplying any power since March 2013. This payment has been continuing till date.

The audit also revealed that the <g data-gr-id="84">discoms</g> incurred operation and maintenance (O&M) expenditure in excess of norms fixed by DERC. “The burden of inefficiencies of <g data-gr-id="85">discoms</g> reflected in the shape of higher rate of WACC (weighted average cost of capital) and carrying cost on RA, which was passed on to the consumers,” it adds.

Inflated power bills were one of the major election issues that the AAP raised during the December 2013 and February 2015 Assembly polls. Following its victory in December 2013, the AAP’s 49-day government had initiated a CAG audit of power <g data-gr-id="88">discoms</g> operating in the national Capital.

The party also attacked DERC for not checking the books of discoms. “The DERC was supposed to keep an eye on these discoms. But did not check its books and the officers at DERC supported the illegal practice of power discoms. Even the government appointed nominees in these power discoms turned a blind eye to what was happening,” Bajpai alleged.

The audit also pointed out that the quantum of power purchased by the discoms was more than what was actually consumed by consumers during most part of the year, creating a surplus power situation. “The availability of power in Delhi was more than its requirement, making it the only power surplus state in the northern grid,” the report said.

“This meant that the consumer paid for <g data-gr-id="83">higher</g> load (near peak load) for the whole year though this higher load was consumed for only a few hours during the whole year,” it says.

The Delhi government, however, refrained from making any official statement. But sources said legal opinion was being sought to move the High Court in this regard.

“We are shocked at the highly irresponsible, factually incorrect, mischievous and distorted reporting in a section of the media on a purported CAG audit report on the Delhi <g data-gr-id="80">discoms</g>,” the spokesperson for two of the companies — BSES Rajdhani and BSES Yamuna — said in a statement.

“These media reports tantamount to blatant contempt of the order of the <g data-gr-id="86">Hon’ble</g> Delhi High Court, which has put a blanket prohibition on publication of any CAG audit report as the matter is sub judice,” the statement said.

It also went on to say that the audit process was still not complete and it would be premature to allege that the CAG has arrived at any adverse conclusions, adding that the two companies will respond to observations, as and when called upon to do so by the official auditor.

The third company, Tata Power Delhi Distribution, also reacted along similar lines.

“The allegations and claims made in some sections of the media in relation to the CAG draft audit report of discoms are speculative in nature. The veracity of facts cannot be ascertained and the matter is sub-judice,” the company said in a media statement.

“As per our knowledge and information, no report has been finalised by the CAG and the matter is currently sub-judice. Therefore, any such action of making the report or any of its contents public may prima facie attract contempt of court proceedings,” it said.