CAG to audit co-op sugar factories

PUNE: The Bombay High Court has asked the comptroller and auditor general (CAG) of India to prepare an audit report of the management of co-operative sugar factories in the state for the period April 1, 2007 to March 31, 2010.

The report should be submitted preferably within six weeks, said the high court order issued on December 13. The order came during the hearing of a public interest litigation filed by Pune-based Ashok Kulkarni, highlighting mismanagement of co-operative sugar factories in the state in 2005. Kulkarni had written a letter to the court which was converted into a public interest litigation by the court itself.

The next hearing in the matter has been fixed after four weeks. The order seeking CAG audit was given by judges B H Marlapalle and U D Salvi.

The high court order has noted that the CAG had conducted a test audit of 22 co-operative sugar factories in the state during 2006-07 after Kulkarni's PIL was filed. The CAG report had revealed that 20 factories had been involved in acts like violation of guidelines and inappropriate fund transfer among others.

The high court has also asked the state government to prepare a master plan for setting up new mills after a careful survey pertaining to irrigation potential, sugarcane availability, need for food security and requirement of sugar.

The court on July 12, 2006 had asked the government not to issue any fresh permission for setting up co-operative sugar factories in the state.

In the order issued on December 13, the court has said that Kulkarni drew the court's attention to the earlier CAG report and also another report submitted by retired IAS officer Shivajirao Deshmukh on the sugar industry in the state. Deshmukh had observed that there was no need to enhance or create additional capacity except in pockets like Solapur, Ahmednagar, Dhule, Jalgaon, Latur, Parbhani and Nanded districts. The report had highlighted that problems confronting the sugar industry were shortage of sugarcane, continuous decline in sugarcane productivity and insufficient recovery rate.

The Deshmukh report added that in regions like Vidarbha, Marathwada and Khandesh with sick sugar factories, there was a need to either revive these units or amalgamate them with efficient factories.

Kulkarni has also drawn the court's attention to the fact that additional units were set up by some co-operative sugar factories, while some factories have increased their crushing capacity by way of expansion under the name of modernisation or alternation or mechanisation. "This is a violation of the court's earlier order about not increasing the crushing capacity of the state," Kulkarni said in a statement here on Thursday.

source: timesofindia