Govt auditor's (CAG) report slams levy of development fee on passengers at Delhi airport

August 17, 2012

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New Delhi, August 17: The government's auditor shared with parliament today a report that says that thousands of crores have been lost in the way in which coal mines were allocated to private players; another report finds fault with how the Delhi international airport was privatised. The government has prepped a detailed defense for both sectors; it will argue that the auditor's calculations are erroneous.

The Comptroller and Auditor General's (CAG) report on the Delhi airport finds that 1.63 lakh crores were lost in the way in which land was leased .

The government's auditor has also objected to the permission granted by the government to the Delhi airport consortium to charge passengers a development fee to help raise funds for the project. The auditor said this was not part of the original contract. The CAG says Delhi International Airport Limited (DIAL) will get an undue benefit of over Rs. 3,400 crore from the development fee.

DIAL charges passengers between Rs. 400 and Rs. 2600, depending on whether they're flying domestically or internationally.

The Delhi airport is run by a public-private partnership between the GMR group, which has 54% stake, and the Airports Authority of India, which is part of the government. Germany's Fraport AG and Malaysia Airport Holdings are the other minority partners in the venture that has operated the Delhi airport since 2006.

The auditor says that land was given to the airport project at highly concessional rates - 4800 acres were allotted, of which 239 acres could be used for commercial purposes like shops at Rs. 100 a year. The auditor says that the earnings from this commercial exploitation will be 1.63 lakh crores.

But in a statement earlier this year, the public-private partnership that handles the airport, referred to as DIAL (Delhi International Airport Limited), rebutted that "It (Rs. 1.63 lakh crore) is simply the absolute amount of revenues that accrue to DIAL over 58 years (45.99 per cent of the same will be shared with Airport Authority of India) - and does not represent the time value of money."

The government will point out that the token rent charged for the land saves the state-run Airports Authority of India hundreds of crores as stamp duty. The government will also emphasise that the concessions available to GMR to run the Delhi airport were part of the bid documents and were available to every bidder, so no preferential treatment was shown to GMR, which landed the project.

The CAG further points out that DIAL was allowed to extend its contract (for Operations, Maintenance and Development of the airport) for another 30 years. This, they say, is a deviation from the cabinet decision of September 11, 2003. The CAG, in its report, says, no infrastructure operator may be allowed to renew lease or extend its contract on identical terms.

The government says this position is factually incorrect as the decision to extend the contract was taken by an Empowered Group of Ministers (EGoM) - which had been constituted - based on a cabinet note of 2003.


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News Network
April 22,2024

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The BJP has opened its account in the ongoing Lok Sabha elections. The party's candidate from Gujarat's Surat constituency, Mukesh Dalal, has won the polls as all his opponents are now out of the fray.

BJP's Mukesh Dalal elected unopposed from the Surat Lok Sabha seat after all other candidates withdrew from the contest, the party's Gujarat unit chief CR Paatil said today. Today was the deadline for withdrawing nominations.

The nominations of the Congress party's Surat candidate and his substitute were rejected by the returning officer over alleged discrepancies in paperwork, a development that the Congress called an attempt at "match-fixing".

"Surat has presented the first lotus to Prime Minister Narendra Modi. I congratulate our candidate for Surat Lok Sabha seat Mukesh Dalal for getting elected unopposed," Mr Paatil posted on the microblogging website X, referring to the BJP's election symbol.

Eight candidates - seven of them independents - and Pyarelal Bharti of the Bahujan Samaj Party (BSP) withdrew their papers.

The nomination papers of the Congress's Surat candidate Nilesh Kumbhani was rejected on Sunday after the district returning officer Saurabh Parghi found discrepancies in the signatures of the proposers.

The nomination form of Suresh Padsala, the Congress's substitute candidate from Surat, was also found invalid.

The returning officer had said the four nomination forms submitted by the two Congress candidates did not appear genuine. The proposers, in their affidavits, had said they had not signed the forms themselves, the returning officer said in the order.

Congress lawyer Babu Mangukiya said the party will approach the high court and the Supreme Court for relief.

Congress leader Jairam Ramesh in a post on X said the Surat developments indicate "democracy is under threat". "Our elections, our democracy, Babasaheb Ambedkar's Constitution - all are under a generational threat. This is the most important election of our lifetime," Mr Ramesh said.

Mr Ramesh alleged the "distress" of micro, small and medium enterprise (MSME) owners and the business community in PM Modi's "Anyay Kaal" and their anger have "spooked the BJP so badly that they are attempting to match-fix the Surat Lok Sabha polls, which they have won consistently since the 1984 Lok Sabha elections."

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News Network
April 23,2024

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Congress workers protested outside the home of Nilesh Kumbhani, the party's candidate from Gujarat's Surat Lok Sabha seat whose nomination form was rejected due to alleged discrepancies, as he was likely to join the BJP, sources said on Tuesday.

The protest came a day after the BJP's Mukesh Dalal was declared the winner from the party stronghold following the withdrawal of all the other eight candidates in the fray.

The sources said that the protesters called Kumbhani a "traitor" and "killer of democracy", adding that he could join the BJP as early as this week.

Kumbhani's nomination form was rejected after he was unable to present even one of his three proposers before Returning Officer Sourabh Pardhi.

The BJP had raised questions about the discrepancies in the signatures of three proposers in his nomination form.

The nomination form of Suresh Padsala, the Congress' substitute candidate from Surat, was also invalidated, pushing the party out of the poll fray in the BJP stronghold.

In his order, Pardhi said the four nomination forms submitted by Kumbhani and Padsala were rejected because at first sight, discrepancies were found in the signatures of the proposers, and they did not appear genuine.

The Lok Sabha elections in the Surat seat was supposed to take place on May 7.

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News Network
April 20,2024

Union Finance Minister Nirmala Sitharaman, on Friday, said that the Bharatiya Janata Party (BJP) plans to reintroduce electoral bonds in some capacity following extensive consultations with all stakeholders, should it come back to power in the 2024 general elections, according to a report in the Hindustan Times (HT).

HT cited Nirmala Sitharam as saying, “We still have to do a lot of consultation with stakeholders and see what is it that we have to do to make or bring in a framework which will be acceptable to all, primarily retain the level of transparency and completely remove the possibility of black money entering into this.”

However, the Centre has not yet decided whether to seek a review of the ruling made by the Supreme Court (SC), she said.

She further added, “What the scheme, which has been just thrown out by the Supreme Court, brought in was transparency. What prevailed earlier was just free-for-all.”

Launched in 2018, electoral bonds were accessible for acquisition at any State Bank of India (SBI) branch. Contributions made through this programme by corporations and even foreign entities via Indian subsidiaries received full tax exemption, while the identities of the donors remained confidential, safeguarded by both the bank and the recipient political parties.

On February 15, a five-judge Constitution Bench struck down the scheme, deeming it ‘unconstitutional’ due to its complete anonymisation of contributions to political parties. Additionally, the Bench stated that the articulated objectives of curbing black money or illegal election financing did not warrant disproportionately infringing upon voters’ right to information.

FM Sitharaman said, some aspects of the scheme need improvement and they will be brought back following consultations.

She also lashed out at the Opposition’s claims that the BJP disregarded criminal charges against leaders who switched from other parties to join the ruling party.

The HT quoted her as saying, “The BJP can’t sit here and say, you come to my party today, and the case will be closed tomorrow. The case has to go through the courts that have to take a call; they will not just say, “Oh, he’s come to your party, close the case.” Doesn’t happen that way. So is this washing machine a term they want to use for the courts?”

She further said that the Union government plans to simplify the process of taxation and make it easy for investments to come through into the country.

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