Kohima Smart City projects lacked proper evaluation, says CAG
A photo of a wall at New Market (Ward 8) that won the wall painting competition organized by the Kohima Smart City Development Limited (File Photo) Credit: EastMojo image

Kohima: The Comptroller and Auditor General of India (CAG) has identified a number of irregularities in the Kohima Smart City mission projects in Nagaland.

The CAG report ending March 2022 was based as per the performance audit which was carried out for the period from 2016-21 to ascertain the effectiveness and efficacy of implementing the smart city projects in the state capital. 

As per the report, the Kohima Smart City Development Limited (KSCDL) did not prepare a feasible report and revenue model for the projects implemented and core infrastructure elements were not prioritized as envisaged in the Smart City Guidelines (SCG).

The KSCDL functions as a Special Purpose Vehicle (SPV) in implementing the Smart City Mission (SCM) for Kohima. As per the guidelines, KSCDL implements the mission within the area under Kohima Municipal Council (KMC) under Pan-City Development and Area Based Development (ABD) comprising three wards namely Naga Bazar, Dak Lane, and Kitsubozou. 

“Improper planning in implementation of projects beyond the scope and objective of Smart City Mission had resulted in infructuous expenditure of Rs 70.75 lakh on procurement of water ATM and water tanker,” the CAG report said.

As per the CAG report, the KSCDL had projected Rs 46.63 crore under water supply in ABD (Rs 13.60 crore), pan-city (Rs 32.28 crore) and convergence/PPP mode (Rs 0.55 crore). It revealed that examination of records showed that water ATMs and tankers were not approved by the Board of Directors (BoD).

The Kohima Chamber of Commerce and Industries (KCCI) was designated to arrange the operators and location for setting up of water ATMs in Kohima with a condition that the operation of the ATMs will be on a revenue sharing model. However, the CAG detected that none of the water ATMs were operational. No feasibility report to assess the actual requirement and viability of the project “Water ATMs” and “Water Tanker” was prepared and procurement was made without the DPR.

While the management had responded to the CAG stating that procurement was made with the approval of the procurement board of the KSCDL and BoD, the response was not justified.

The CAG said that there has been weak financial management which resulted in delay in release of funds ranging from three to 15 months and short release of state matching share of Rs 178 crore.

It also detected that the KSCDL made payment to three firms- Bharat Electronics Limited for the Integrated Command Control Centre project, M/s WAPCOS for Project Management Consultancy (PMC) and M/s Symbios Creations Pvt Ltd for the Wi-Fi project, without deducting Tax Deducted at Source (TDS) on Income Tax.

The KSCDL also transferred funds to government departments/agencies against the advisory issued by the ministry. 

Further, non-assessment of feasibility of the project before its implementation resulted in infructuous expenditure of Rs 85.57 lakh on Construction of Multi Utility Duct.

Meanwhile, scrutiny of records also revealed to the CAG that Rs 163.64 lakh was paid to the contractor M/s Viu Angami & Sons for the work “Construction of Community Hall cum Car Parking at New Market Colony, Kohima, Nagaland” and that full payment was made to the contractor after undertaking measurement of the works done.

However, it was revealed that the contractor was paid Rs 11 lakh without actual execution of 10 items of works, indicating that “fictitious entries” were made which led to excess payment of Rs 11 lakh.  In this regard, the CAG recommended that the responsibility be fixed on the erring officers for false entry and release of money without actual execution of work. 

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CAG concluded that the KSCDL did not prioritize the core infrastructure elements, prepare feasibility reports and revenue models in violation of the guiding principles  in the identified projects. 

Out of 61 prioritized projects, only 28 DPRs were complete of which eight projects were completed by October 21. 

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