C’Wealth Games scam: Did NDMC waste Rs185 crore on renovation of Shivaji Stadium?

The Shunglu committee has pointed out several irregularities in the New Delhi Municipal Council’s (NDMC) renovation work of the Shivaji Stadium and termed the expenditure of Rs185 crore by the civic body as “unwarranted”.

“Under the pretext of upgrading of the Shivaji Stadium, the stadium was demolished and is being reconstructed, aided by a nexus formed between officers of the NDMC, the consultant (M/s Raja Aederi Consultants) and the contractor (M/s China Railway Shisuji),” the committee said in its report recently submitted to the prime minister’s office.

“It was observed that Shivaji Stadium was initially identified as a venue for women’s hockey in 2004…The decision to use Shivaji Stadium as a hockey training venue was communicated by the organising committee in December 2005.

“The decision to demolish and reconstruct the stadium was not available on file. The contract for the ‘Improvement/upgradation of Shivaji Stadium’ was finally awarded to M/s China Railway Shisuji for Rs160.27 crore, over 10 times the initial projected cost of Rs15 crore,” it said.

“Also, revised administrative approval and expenditure sanction was obtained for Rs185 crore after award of contract, with no reasoning for the inclusion of the additional Rs25 crore,” the report said.

The panel slammed the NDMC for taking up the project which could not be completed before the start of the Games last year and remains incomplete till today.

“The entire project was not in the first place required, however the NDMC was determined to renovate the stadium for future use, and thus used CWG 2010 as a ruse to obtain the funds for the same from the Government. Work at the stadium is still continuing as on date (February 2011),” it said.

Interestingly, the work was sub-contracted to M/s Simplex Projects at Rs 80 crore, nearly fifty per cent below the actual cost of work awarded to M/s China Railway Shisuji, a Chinese firm.

“Contract was awarded to an ineligible party, a Chinese company which had not executed any work in India at an exorbitantly high cost of Rs160.27 crore. The work was promptly sub-contracted to M/S Simplex for about Rs80 crore. In the meanwhile NDMC officials obtained administrative approval for Rs185 crore. At least for the CWG 2010, such an investment was not necessary,” the report said.

The committee under the chairmanship of former CAG chief V K Shunglu found irregularities in “substitution of stadium chairs” which cost a loss of about Rs6 crore to the exchequer.

“As per the tender and the agreement, chairs of notified specifications were to be fixed at the stadium. The price of these chairs as per the tender document was assessed at the rate of Rs1,200 each. The firm, China Railways Shisuji Group Corporation, had quoted the price of the said chair at the rate of Rs1,730 each…,” it said.

The firm later expressed inability to provide the type of chair mentioned in the contract and agreed to provide the “same chairs (which) were supplied to Jawaharlal Nehru Stadium and other stadiums during CWG.”

“Claims by the firm about the supply of the same chairs to Jawaharlal Nehru Stadium and other stadiums were incorrect. It was found that the chairs for the lower tier in the JN Stadium and others were supplied by M/s Swadeshi Construction Co at the rate of Rs 1,462 per chair…

“It is evident that there has been collusion between the vendor and NDMC officials, whereby it was pre-decided that these expensive substitute chairs would be installed instead of the chairs listed in the contract…

“The firm has raised the bill for these chairs at the rate of Rs5,777 per chair and with VAT and fixing charges it works out to Rs7,781 per chair. If this bill is paid as proposed by the firm, NDMC would pay Rs7,31,41,400 against the agreed cost of 1,62,62,000 which works out to payment of Rs5,68,79,400 above the agreed cost,” it pointed out.

“There have been various instances of collusion between the NDMC and other parties such as the consultant and contractor, which have resulted in appointment of an ineligible consultant as well as contractor, as also unwarranted expenditure on this (Shivaji Stadium) project,” the committee said.

The high-level committee had submitted six reports on host broadcasting, the Games Village, city infrastructure, Games venues, organising committee and Main Report – Organisation and Conduct of CWG, 2010.

In its reports, the committee has pointed out several irregularities on the part of Delhi Lt governor Tejinder Khanna, chief minister Sheila Dikshit, sacked Games organising committee chief Suresh Kalmadi and secretary general Lalit Bhanot among other senior government officials.