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Delhi LG approves proposal to initiate CBI probe into the procurement of low-floor buses by AAP government. Here is what we know so far

In July last year, a three-member committee constituted by the Lt Governor of Delhi directed the Delhi Transport Corporation (DTC) to scrap the Annual Maintenance Contract (AMC) awarded for low-floor buses due to ‘procedural lapses’.

The Lieutenant Governor of Delhi, VK Saxena, has given his nod to a proposal by the Chief Secretary to forward a complaint to the CBI about the alleged scam in the procurement of 1000 low-floor buses by the Delhi government.

In a complaint filed with the LG in June 2022, it was alleged that the Delhi Integrated Multi-Modal Transit System Ltd (DIMTS) was appointed as a bid management consultant for the tender of 1000 low-floor DTC buses to facilitate wrongdoing.

It was also claimed that the Minister of Transport was appointed as Chairman of tendering and procurement committee in a pre-meditated manner. Reportedly, the complaint was then forwarded to the Chief Secretary on July 22.

On August 12, the Chief Secretary submitted his report, pointing out irregularities in the tender and recommended CBI probe into the matter. Delhi LG VK Saxena stated that a probe by the central agency was already underway and approved the clubbing of the existing complaint with the current complaint.

The Background of the case

In July last year, a three-member committee constituted by the Lt Governor of Delhi directed the Delhi Transport Corporation (DTC) to scrap the Annual Maintenance Contract (AMC) awarded for low-floor buses due to ‘procedural lapses’.

The committee was constituted by then Delhi LG Anil Baijal to probe the alleged scam in the procurement and AMCs of the new fleet of buses. The DTC had floated separate tenders for the purchase and AMC for the buses. Although the initial plan was to award a ₹4265 crore contract for AMC for 1250 buses, the number was reduced to 1000 buses.

The maintenance contract of ₹3412 crores was kept for 1000 buses for a 12-year period. While the purchase order was given to JBM auto and Tata Motors on a 7:3 ratio, it was expected that a large number of companies will bid for maintenance contracts.

However, the committee found that the tender conditions ensured that there were not many bidders for the AMC contract. The committee highlighted that DTC could only procure low-floor CNG buses due to the orders of the Judiciary. It added that there are a few manufacturers of such buses in the market.

The committee emphasised, “If these deviations had become necessary, DTC should have ensured that they did some kind of reasonableness test for the rates of the AMC, especially since the rates were far higher than what they were in earlier contracts. To say that they did not have the expertise is not a good enough response.”

The report concluded, “The committee, prima facie, did not come across any material to impute criminal misconduct attributable to any public official. There were only procedural lapses apparently arising out of a bonafide decision-making process. However, a greater effort for understanding the market and a greater degree of due diligence in assessing the reasonableness of bids was required compared to what seems to have been demonstrated.”

The committee comprised of IAS OP Agarwal, Principal Secretary (Vigilance) KR Meena, and Principal Secretary (Transport) Ashish Kundra.

Ayodhra Ram Mandir special coverage by OpIndia

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Searched termsDelhi government scam
OpIndia Staff
OpIndia Staffhttps://www.opindia.com
Staff reporter at OpIndia

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