The armed forces and Comptroller & Auditor General of India (CAG) are at loggerheads over the auditing of the 4,500 unit-run canteens which have an annual turnover of Rs 10,000 crore.
Documents available with The Pioneer show that the chiefs of the Army, Air Force and Navy have refused to comply with the direction of the Defence Secretary to permit the CAG to audit the unit canteens.
The Secretary had conveyed the direction of Defence Minister AK Antony, who had received a complaint from the CAG on the denial of audit by Army Headquarters.
“Since no headway has been made in this regard, the CAG has written to the Raksha Mantri on this issue and has requested his intervention for providing audit parties access to unit-run canteens (URC) as early as possible,” noted the Defence Secretary’s letter to the three service chiefs, marked ‘secret’.
“It has been observed by the CAG that considering the facts that URCs are located in Government premises, are run in most cases by service personnel, use Government transport and, most importantly, receive substantial funds from the Consolidated Fund of India, such denial violates provisions of the Constitution of India regarding the powers and duties of the CAG,” it added.
“It is, therefore, requested that necessary instructions may kindly be given to the concerned for allowing audit personnel to access information from the URCs under their control so that RM is apprised of them,” the Defence Secretary wrote.
Meanwhile, on September 7, Public Accounts Committee chairman Murli Manohar Joshi summoned the vice-chiefs of the Army, Air Force and Navy and directed them to provide access to the CAG for auditing unit-run canteens.
Earlier, in the second week of January, Joshi had summoned heads of the three forces on the same issue.
According to sources, the Vice Chiefs, who were representing the heads of the three Services, vehemently objected to the auditing of CAG in the Unit Run Canteens and claimed that each canteen is audited by chartered accountants. At this point Joshi told them that this argument was not tenable and questioned the reasons for preferring Chartered accountants over the Government Auditor.
While Vice Chiefs contended in the meeting that it was not possible for CAG to audit all 4,500 canteens, the CAG officials countered that they would audit on random basis and if they found irregularities, would consider further auditing.
Joshi directed the three forces to submit a detailed report on how to make way for audit of unit run canteens within a week and suggested for a high level committee of auditors and forces to resolve the issue.
For the past two years CAG and forces are locking horns over the auditing of Unit Run Canteens. In India, the forces supply system is managed by 34 depots of Canteen Stores Department (CSD), which is distributed through the 160 lakh end users through more than 4500 canteens, controlled by each unit. The Unit Run Canteens would take a margin at an average of four percent on the supply and the profit is expected to be around Rs.500 crore in the annual turn over of more than Rs.10000. Though CAG got access to audit the 34 CSDs, forces object the auditors when they demanded to check the accounts of Unit Run Canteens, where the actual sale takes place.
The forces get the money from the Consolidated Fund of India and enjoy Quantitative Discounts approved by the government, apart from the avoidance of taxes on most of the supplied items.
The CAG has argued out that as the fund is made available from the Consolidated Funds, they have the right to audit where as the forces claim that the affairs of the Unit Run Canteens are “purely private ventures of each units” and hence no need of auditing.
-via Daily Pioneer
CAG is a competent authority of GOI. Its observations/recommendations should be honoured by GOVT.Once the CAG has placed their report before the PAC<AND WHEN PAC examined,cross examined took view of the effective both parties ie the tri- services and the CAG, submit their comments/recommendations to the GOVT,then there is no way except to honour the PAC report by the Govt. PAC submitted its report in LoK sabha in Dec 2011.The report has perused by the Lok Sabha and the Rajya Sabha and fwd to the concerned Ministry for action. Delay in action taken report by the concerned Ministry is serious issue. I request the Ministry to look into the matter.
Regards,
TS Chauhan,EX Secretary General , AIDCCEU
As CAG has made objection on Quantitative Discount (QD) which is given by the Canteen Stores Deptt. to Unit Run Canteens (URC) but inspite of all objections of CAG the Canteen Stores Deptt.has issued orders for disbursement of Quantitative Discount (QD) to all 4500 Unit Run Canteens (URCs) for the year 2010-11. The orders are issued on 22.03.2012 and through these orders a huge amount from public fund will go to dustbin.
“The CAG has argued out that as the fund is made available from the Consolidated Funds, they have the right to audit where as the forces claim that the affairs of the Unit Run Canteens are “purely private ventures of each units” and hence no need of auditing”
That’s an extract from the report published above. As I have explained in the past 65 years total contribution in the name of Regimental Cutting had been made by the entire range and depth of armed forces personnel is merely 60 crores in comparison to Rs 1000 crores profit being earned from the private ventures by those Units from their Unit Funds means portion of the contribution equivalent to 0.0070 and 0.0045 times the basic pay of the PBORs and Officers respectively( appx Rs 10 Crores in a year post 6 Pay Commission). Whereas it ends up making Rs 1000 crores in a year. And spends almost 80% of the income for its mere 5% of the officers cadres which is appx 800 Crores in a year. That’s why military Top brasses are adamant to keep that booty as their private funds. It is enough to buy any Defence Audit official, any CAG official, any S C judge , any journalist, any bureaucrat, any politician , any Defence Minister and anybody who think otherwise.
Unit has no source of income other than what is known as the regimental cutting. All other incomes be it CSD , Non Csd profits from sale or as rebates are public money.
Hello
sir how r u
tell me whether your S L P has been registered in the Honorable S C give me the case number please
094186-68882/3
098167-58077
thanks and regard
adv- H.P
suman thakur
I am stuck up with my draft PIL with two valid observations from the friends from the netizens experts in their respective fields:-
a) A rough estimate as to the cost to the exchequers for running CSD ( Hq at Mumbai, 6 Regional Offices at six prime locations and 35 Depot across the country.
b) CSD facility is meant for troops( financial limits exist based on Ranks).And that limit is inclusive of the purchases made by their spouses, dependents with add on cards from any URC in this country. 13.2 lakhs serving soldiers. From Sepoy to Generals and their equivalent in two other services if graded Rs 3000 for liquor and Rs 5000 for PBORs each one can buy goods worth of Rs Rs 8000 at the max. It makes the total purchase to 13.2 x 8000 lakhs or 105.6 croes per month and 1267 crores a year. Multiply by 1.5 to cater for the total purchases of appx 25.6 lakhs Ex-servicemen ( included later to expand clientele) with purchase limit exactly half the serving soldiers but in a reversed pyramidical order. multiplying Rs 1267 by a factor of 2 will give us a closer value which is Appx 2500 Crores.
c) But the sale is Appx 9640 crores annually. The difference due to sale of goods to defence civilians and to unauthorised personnel which appx 7000 crores annually.
c) My PIL is all about stopping this sale of Rs 7000 crores for which the govt of India is providing additional infrastructures , Man powers and all other facilities that are associated to maintain that additional forces. The point is argued by the experts at the end of sale the CSD is making profits . More the sale more is the profits. What is the harm if Tom , Dick & Harry are allowed to avail CSD facility. I need a figure to highlight that by allowing 121 Crores of people of this country what will happen to our economy at large and then deduce how much loss due such clandestine operation the centre and the states are loosing on excise and sales tax besides bleeding profusely to run that white elephant namely the Canteen Stores of India.
d) On the other hand profits accrued at the URC end is appx 10 percent of the total sale which is then by the monkey trick is getting converted into some private funds ready for abuse by the generals and their spouses etc etc.More the clientele more the sale and more the profit and more the misuse with none not even the CAG allowed to peek . The chartered Accountant community of India like their Price Water Coopers ( SATYAM INFAOUS) are engaged privately by the generals and do their onerous duty to fail india in all respects. They have never asked those generals or the commanding officers for the auth to run such private ventures while preparing for the ultimate battle on the country’s border. Their palms are greased and they are happy. So are their regulating authority.Now I need to put a figure , a loss to the govt of India for allowing expansion resulting into additional sale of Rs 7000 crores annually from non-eligible categories, allowing Def Department employees /Est to run their URCs for their employees.
d) And lastly I need to put a figure on to the gross misuse of govt buildings for running of such private ventures for private profits.Take a look:-
No govt accomodation is authorised for running of any canteens including CSD canteens or non CSD canteens. Now there are appx 4500 URCs( presently denotes CSD canteens only). With URCs as nucleus there are more than 15000 other private ventures ordinarily called unit canteens, unit shops etc etc.. All those are accommodated inside govt accommodations. None is authorised. It requires no Rocket scientists that armed forces including the DRDO, DEFENCE Audit etc etc are vacating stores / other accommodations meant for sophisticated military arsenal to declare those building/accommodation vacant and then arrange clandestinely with MES( Money EARNING Service) to make it rentable . And to utter surprise to one and all .who is deciding the rents of Rs 5 per square meters of built up accommodation? It is the same Army which is misusing it. Yes now I need to put a figure how much loss govt is incurring by maintaining those rented buildings knowing them to be surplus. A contractual money against each private ventures is also extracted from the civil contractors /Dealers and credited to that private funds.
Will somebody help to make the PIL rocksolid?
1. Money involved is tremendous & expenditure unchecked/unaudited will lead to major corruption.
Following accounts must be brought under preview of cag/audit
A] Canteen accounts
B] Regimental accounts
C] Regimental association accounts of all arms & services
D] Officers mess & jcos mess accounts
E] Intelligent fund account
F] Field accounts
2. You will see large amount of corruption & various heads at higher level will roll down,
3. See latest case of lt gen ray DG Assam Rifles.regimental money amounting to Rs 23000/ money spent on wife’s expenditure.
4. If one cannot maintain wife he has no right to keep her.
Dear All
I request please go through the post below on the very efficacy of terming the funds as non-public/ regimental hence private funds. There are deeper conspiracies.It is a simple but effective loot and scoot machine where the political bosses, the bureaucrats, the military generals, the Defence Audit officials are party to this loot.
CAG is well aware of the loot and scoot and trying to bark at the wrong tree for some mysterious reasons..
Non-Public Funds de-mystified
Regimental Funds
1. Comprises all funds other than public funds maintained by a unit which are financed wholly or partly from public money and also financed from private sources and subscriptions by the individuals. Regimental funds financed from public money differ from public funds in that the unexpected portion of the former is not refunded to the govt at the end of the financial year.
2. Funds partly or wholly financed from the public money:-
i) Condiments allowance:- Given by the govt of India to purchase condiments required for preparation of meals. Drawn from Imprest Account on Contingent Bill.
ii) Band Allowance: – Regimental centres /Corps training centres authorize to maintain Bands are given Bands maintenance allowance. This allowance being inadequate is also supplemented by contribution by persons in the Regiments / Corps.
iii) Officers’ Mess Maintenance Allowance:-For maintenance of Officers Messes monthly allowance on a sliding scale supplemented by compulsory mess subscription is claimed from Regional CDA at the following rates:-
a) For first 10 officers @ Rs 30 per officer per month.
b) For next 15 Officers @ Rs 20 per officers per month.
c) For remaining officers @ Rs 10 per officer per month.
3. Funds Financed by Private Sources and by subscriptions:-
i) Regimental Fund( Unit Fund):-All personnel in the unit subscribe to this fund.Utilised for the general well being of the unit at the discretion of the OC unit.
ii) Sports Funds ;- As the amenity grant provided by the govt of India is inadequate additional amount of subscription is collected for this fund.
iii) Religious Institution Fund:-Mandir/Gurdwara etc funds are collected from personnel, utlised for the upkeep.
iv) Canteen /Garden Fund: – There is no subscription as such; the profits from occurring from running of canteens and gardens are utilized in the best of the interest of the unit & personnel at the discretion of the OC unit.
Regimental Cutting
The Commanding Officer acts as the trustee of the funds who is to ensure that the expenditure is incurred judiciously for the welfare of troops.
Recoveries:-
Personnel below Officers Ranks (PBORs):-To contribute not to exceed 0.70 percent of their basic pay per month.
Officers: – Regimental funds are primarily intended for JCO/ORs(PBORs).Officers received no direct benefit from these funds. Contribution from the officers is not to exceed 0.45 percent of their basic pay of the rank per month.
This amount is recovered in the name of Regimental Cutting per month against the various heads i.e. Regimental/company Fund,Mandir Fund, Sports fund, Family welfare Fund, Barack Damage Fund etc respectively.
Public Funds for welfare
Amenity:-To provide recreational facilities such as sports gear, radios, TV etc etc money is claimed from the Regional CDA at the rate of Rs 20 at an average per person per annum.
Annual Training Grant:-Allotted by AHQ to the lower formations which is then allotted to the units depending on the requirement.
Educational Training Grants:-Claimed @ 90 paisa per head from CDA and another 30 paisa per head per month from AHQ.
Incidental & Miscellaneous Grant: – Known as annual contingent Grant is allotted for purchase of stationery etc.
Subscriptions from the men in uniform for the past 65 years
As has been highlighted a mere 0.0070 times the basic pay a PBOR contribute per month as the regimental cutting which then redistributed various heads eg company fund, barrack damage fund, mandir fund, sports funds etc. PBORs are not required contribute any other contribution in excess of 0.0070 times his basic salary. From newly recruited to a promoted Subedar or its equivalent in other two Arms one PBOR takes around 24 years of service. His present basic salary ranges from 4000 to 8000per month since 01 Jan 2007( Sixth Pay Commission).An average of Rs 5500 as the basic salary of a PBOR would suffice for the purpose calculating total amount money received from PBOR as regimental cutting. There are appx 13 lakhs serving personnel who are required to contribute. Out of this 5 percent constitute as officers. Officers’ mean value for basic salary could conveniently be taken as 15000 per month. This comes to [{( 13-0.5)x5500x0.0070}+(0.5)x15000x0.0045}x12x5=50900]laths for the past 5 complete years with the salaries received post Sixth pay commission as the regimental cutting against total salary received Rs [{(13-0.5)x10000+(0.5x25000)}x12x5= 8250000]laths for the same period.
As there was a quantum jump in the 6th pay scale we can easily adopt a mathematical model dividing the amount received during the past 5 years to guesstimate the amount contributed by the armed forces personnel for the past 60 years starting from the year 2006.Therefore in my guesstimate amount contributed by the men in uniform keeping the strength constant for the past 30 years as 13 laths and last 30 years approximated to 7 laths we get Rs {(30900/5)=6180}per year from 2007-11.Which if graded as per the fifth, fourth and third pay commissions the contribution would have been in the range of 6180/10 , 6180/30 per year & 6180/50 for the past 30 years before 2007.We get Rs 9479[{(6180/10)x10+(6180/30)x10+(6180/50)x10}=9479]laths for the past 30 years. For the last 30 years in that graded scale we get Rs {(6180/50)/10}x10}+ {(6180/50)/30}x10]+{(6180/50)/50}x10}=189.52 /13×7= 102.04]lacs for the last 30 years. A total of therefore Rs (50900+9479+102.04= 60481)lacs contributed by the armed forces personnel in the past 65 years of existence whereas payment received during the past five years by the serving armed forces personnel is appx Rs 7512500 which is just 125 times the total contribution made by the armed forces personnel during the past 65 years of existence.
Now take a look at the sale of only CSD goods as per the official date provided by the ministry of defence.It is Rs 9496 Crores during the year 2010-11.Total income of the troops(serving soldiers) as has been calculated above is 8250000/5 =1650000lacs per annum i.e 1650 crores. Total salary paid to the double the pensioner will be almost same as the amount paid to the serving soldiers. This if added to the total salary paid to the serving as well as retired service men would together make it Rs 3300 Crores. But the sale from CSD during the last financial year was 9496 crores. Who purchased the stores worth rupees 9496-3300=6196 Crores during 2010-11?A small amount contributed by the not so dependent parents, spouses and children of the serving as well as retired armed forces personnel. But largely it was the civilians from the department of defence, home and casual civilian employees of URCs who made the purchases not meant for them. It is obvious even if the entire pay and perks of the serving armed forces personnel, the defence departmental personnel, the casual employees of the URCs combined will fall short of the total amount sale from the CSD in a financial year. This is most worrisome.
Now compare the total amount regimental cutting which would have been contributed by the serving armed forces personnel for the sports, recreation, Mandir company , barack damage , family welfare activities etc etc for the past 65 years which comes to [60481x100000/100000000=60} Rs 60 Crores against yearly profit made at the URCs end worth of Rs 474.8 crore(9496x5%profit)plus another Rs 125 crore transferred from the CSD profit as some grant in aid or QD as per the existing rule. So that makes it Rs574 crores of profit added each year to the kitty of that Regimental fund which is peanut in comparison.
In addition three services as well as the defence departments are in rat race to convert almost each and every defence building into rentable building and hand it over to the highest bidders which ranges from a few thousands to few crores per annum. Govt of India gets only Rs 5 per sq mtr of built up accommodation as the licence Fee. The money received as per the contract between the OC unit( the Trustee) and the civilian contractors which ranges from a few thousands toa few crores again goes into that deadly Regimental fund. This is termed as the Rebate and no sane person despite having all love and respect for the dear Army will not term it as the private money. But army authority abetted by the lies of even CAG is not ready to venture into this black fund which legitimately belongs to public fund and should have been deposited in to the consolidated funds of India. As per my guesstimate this rebate can be estimated 500 times the meager Licence Fee being deposited into the govt coffer. Moreover there are many more skeletons in this cupboard as many such ventures being run inside the defence buildings are not reported in collusion at the highest level. If I am allowed to hazard a guess the rebates including the profits from the sales of non-CSD stores by the unit personnel will be equivalent to amount of profit being accrued from sale of Canteen stores i.e another appx 500 crore per year.
That’s makes Rs 1000 crore a year industry without any capital investments against a mere Rs 6 Crore [{(12.5x5500x0.0070+0.5x15000x0.0045)x12}=6180x100000/100000000] of so called Regimental subscriptions made by all the serving armed forces personnel per year. Rs 100 crore was transferred recently from the profits of CSD itself is 20 times the amount contributed by the whole of Army. It’s a good investment as Armed forces personnel supported by the ministry of Defence and its audit agency are not willing budge an inch from their stand that URCs are private ventures and privately funded etc etc etc.Its a good excuse for the Defence Audit which is also taking its pound of flesh compelling army auth to authorize them to run their own URCs in the defence buildings. And in the name of URCs other commercial ventures are a reality being run by the defence audit departments, the Defence Scientists all in the name of welfare of Troops.
But why the office of CAG and the ministry of finance are mute spectators . Either each and every serving bureaucrats are getting their shares in some direct or indirect way or they are waiting for their turn to be in the ministry of defence in the near future. The CAG which is about to pull a democratically elected govt at the centre with its presumptive loss on 2G is seen seating pretty cool on this very hard facts of loot and scoot by the armed forces, the Defence Audits , DRDO etc etc. They are the ones which have all the data on receipts from rented buildings as the License fee. They are very well within their rights to demand details of the Rebates and on what extra constitutional authority unless they are themselves a party to that loot from the armed forces units as well as from their own Bureaucrat infested Defence Audits, DRDO etc etc.
Who is stopping them?
For whose welfare
Out of appx 14 lacs serving soldiers there are appx 5 % are Officers , another 15 % are Junior Commissioned officers and remaining are Jawans. Carry home pay for officers on an average is appx Rs 20000 , For JCOs appx 12000 and Jawans 8000 per month. There are appx double the number in each category of ex-servicemen drawing exactly the half that the serving soldiers .
Total carry home of pay of armed forces personnel including the ex-servicemen thus can be calculated as :-
Rs [{14(.05x20000+0.15x12000+0.80x8000) +28(.05x10000+0.15x6000+0.80x4000)} x100000]
= [ {14x(0.1x20000+0.3x12000+1.6x8000)x100000] = 309.12 crores per annum
Serving as well as retired personnel are authorised liquors according to the ranks which can be summarised as follows:-
Officers : 12 bottles on an average. Or Rs 4000/-
JCOs : 08 bottles on an average Or Rs 2000/-
Ors : 04 bottles on an average. Or Rs 1000/-
Limit for the ex-servicemen is appx 60% of the above.
Total amount that could be spent on liquors by the serving as well as ex-servicemen if all the liquors are drawn will be Rs :-
[{14x( 0.05x4000+0.15x2000+0.8x1000)} +{ 28x0.6x(0.05x4000+0.15x2000+0.80x1000)}] Lacs pm.
Or [ {14x(200+300+800) + 14x2 x0.6(200+300+800)}x12] Lacs pa.
Or [ {14x1300x( 1+1.2}x12] Lacs pa.
Or 14x1300x2.2×12 Lacs per year
Rs 480.48 Crores per year.
However as per the sale figures available from the CAG reports liquor sale is more than 5000 crores per year which is 5000/480.48 i.e ten times the authorised quantum of liquors that could have been sold to the troops. One need to be deaf and dumb to find the gross abuse of liquors through CSD outlets.
Similarly there are monetary limits for the purchase of groceries as well which is ordinarily lower than the monetary limits laid down for purchase of liquors. Even if we assume full quota of grocery is being purchased by the troops and allow allowances by stretching the limits equal to that of the liquors we get the figure of Rs 480.48 Crores a year. But the sale of grocery minus the sales of AFD items which are procured directly from the CSD depot is appx 4600 crores for the year 2010-11 as per the official figure available in the net. It is therefore obvious that another appx Rs 4000 crores of worth of CSD grocery (as liquors are not sold to the civilian employees supposedly employed in the ministry of defence)is being sold to those civilian employees and their families . As per the official website there is a monetary limit for each and every smart card holders including the so called defence civilians who are allowed to avail CSD facility from the services canteens as a good will gesture for their good service to the defence services consequent to a decision taken during Board of Control Canteen Services wherein Raksha Mantri is the Chairman. That meeting was held on 18 March 1986 when Mr Pradeep Kumar, the present incumbent CVC, was the secretary of the BOCCS in the ministry of Defence under the Mr AK Anthony as the Defence Minister. It is appx ten times the total sale of grocery to the serving as well as the ex-service men. One need not hazard a guess to know how CSD facility is put to extreme abuse.
So there is gross misuse of the facility that’s called CSD facility. Govt of India bleeds profusely supposedly for the welfare of the troops. But question that noble intention but lets take a look at the profits on the running capital invested by the govt of India ( Capital investment is not even considered while calculating profits made either by the CSD or by the URCs):-
With HQ located at the prime location of Mumbai( employees of the CSD being the govt of India employees are paid higher rates in respect to HRAs etc) there are six Regional Offices at six Metro Cities and 35 CSD depot across the country with all its capital as well as running expenses paid by the govt of India. There are 4500 URCs being run by three services as well as by the likes of Defence Audit Departments, DRDO etc etc, all on Defence Accommodations built for some other urgent purposes as there is no govt sanction to construct URCs for any military Unit or Defence Establishment. Rent recovered from those URCs being run on govt buildings is Rs 5 per square metre. Sale of CSD goods was Rs 9460 Crores during the year 2010-11( as per the official data available). CSD procure those stores in bulk direct from the manufacturers and sale it to its Retail outlets i.e URCs at meagre profits of 2.5 % on an average to keep the input cost lowest possible. No overhead charges are to be added as everything else comes to CSD free of cost sorry at the cost of the nation supposedly for the welfare of the troops. During the year CSD sale was Rs 9640 Crores and has earned appx Rs 0.0025×9640 crores of profit or Rs 241 Crores. As per the existing policy( whatever that maybe) 50% of that hard earned profits on the running capital invested by the govt of India is then passed on to the beneficiaries( ie the URCs) directly from the CSD account. Other 50 % is then deposited to the consolidated funds of India which allot each and every penny spent by those armed forces. A whopping Rs 120 Crores is therefore the bonanza for the Army besides its own profits from the URCs for the sale of CSD goods.
What is the profit at the URCs end for a sale of Rs 9640 from the CSD? Retail rates at the URCs vary from 2.5 % for some of the items to 10 % for liquors. An average of 6% on the sale of Rs 9640 Crores will be sufficient to get the required figure. Hence profits at the 4500 odd URCs being run by three services as well as the various departments of defence on the defence buildings rented at a fee of Rs 5 per Square Metre can be estimated as Rs 9640 x 6/100 Crores i.e Rs 578.4 crore annually. Assuming an average of 30 sq metre of accommodation per URC total expenses towards rent for the 4500 URCs would be Rs Rs 5x30x4500 i.e Rs 6.5 lakhs. Some of URCs do pay some water and electricity charges to the govt of India which can be guesstimated as Rs 10 Lacks at the max. And many of the URCs especially being run by the Formation HQ & the Defence Departments do employ a few civilian employees and pay them from the profits. Taking the strength of those adhoc casual civilian employees of the URCs at an average of 3 per URC and a payment at an average of Rs 4000 per month, total expenditure on salary for the URC employees for the 4500 URCs in year comes out to be Rs 4500x3x4000x12 i.e Rs 6.4 Crores per year. Hence gross expenditures towards pay,rent and allied charges for the 4500 URCs is appx 6.5 Crores annually. Rounding up to cover other incidental expenses to Rs 10 Crores net profits from the URCs at the URCs end is Appx 568 Crores annually. Adding that Rs 120 Crores of bonanza received from the CSD kind courtesy Min of Def etc annual profits from this welfare activity being run in the name of CSD facility is Rs 668 Crores for the year 2010-11.
Now CSD canteens or the URCs as the nucleus regular military units as well as almost all department of Defence are running NON-CSD outlets selling vegetables, bakery products, cold drinks /ice-creams , LPG ,petrol/diesels on the so called rentable Defence Buildings as none of those commercial outlets are authorised to any defence units /establishments .There are schools, colleges, Plant Nurseries, Banks, ATMs etc on the rentable defence built up accommodations .or on leased lands . All those commercial shops either run by combatants , civilian govt personnel or by the civilian contractors / multinationals and pay Rs 5 per Square meter against rent and pay their Electricity and water charges as applicable to the govt of India. But the story does not end there. A contract is then signed between the OC unit or his delegated officer and the civilian contractors/multination for use of defence building for commercial purposes. A rebate at the least 100 times the amount paid as rent per sq mtr is recovered per month per such commercial outlets . Assuming a figure of 3 per URC there are therefore 3×4500 NON-CSD outlets of which one fourth are being run by the government employees including combatants who are paid extra duty pay and can be easily verified from the records. Taking the same quantum of accommodation per commercially run ventures by the civilian contractors , banks etc ( i.e 30 Sq metre per venture) Rebate received by the three services including the departments of Defence can be estimated as Rs 4500x3x0.75x30x5 x100x12 i.e Rs 18.22 Crores a year. This amount technically should go to the consolidated funds of India as those ventures are being run in the govt of India accommodations but land up getting added to the Regimentally maintained private funds. There is no such fund called Regimental funds for the Defence Departments and hence they make it a point that the loot is equitably distributed to its employees in the forms of dividends.
There are Malls and Supermarkets, schools, golf courses, colleges, cultivated lands, donations from the places of worships meant for the troops, donations from civil society foundation days , raising days , Corps Days etc etc. All such money is again finds its way to that private funds insulated from the oversight or the office of CAG. It is impossible for the office of the CAG to get the exact figure as money received against contract between the OC unit and the private party is in black and white and held with the heads of units /Establishments who are govt servants. As per my guesstimate annual income from those commercial ventures including the profits from sales from the NON-CSD outlets run by the combatant/civilian govt employees would be not less than another 500 Crores in a calendar year. This makes the Armed Forces Units and the defence establishment a Rs 1000 Crore plus profit per year industry with no investment what so ever. One may dispute this by saying that armed forces personnel do contribute (o .70 percent of the basic pay by the PBORs & 0.45 percent of their Basic pay by the Officers per month) some money as Regimental cutting. This is simply the peanuts in comparison hence ignored. Besides pay and perks to the individual employee Govt of India on the other hand allot a substantial sum of money for the collective training as well as recreational activities in the forms of Training grants , Office Grants, Education Grants , Amenity etc etc. If such grants are found inadequate govt of the day is ever willing to consider the case on merits and allocate more funds especially for the welfare activities of the armed forces personnel pre or post audited at the appropriate leves.
This Rs 1000 Crore per year bonanza in the hands of the troops is the case in point. Who holds that amount? As per the existing policy this so called regimental funds with the troops are to be held by the OC unit who is considered the trustee of that funds. The reign of this fund is never diluted below commissioned officers in the Armed forces. I am not sure what rules are being followed in the defence departments which are growing astronomically.
Are there any rules? Yes of course. The self regulation is the high point there. The custodians or the commissioned officers have framed some rules. Take a look:-
That not more than 40% of the total profits accrued / revenue received from all sources in a financial year could only be spent. So ordinarily 60% of the total revenue should remain unspent.
That not more than 40 % of the total expenditures as stated above shall be on expendable items. That all items purchased should be taken on charge. So 60% of the expenditure should add up to the value of the property held in the name of so called regimentally held private funds.
In the most conservative estimates had the rules thus framed followed by the three services interest from the unspent amount of money held in those regimentally held private funds after 65 years would have yielded an amount equal to presumptive loss of 2G spectrum scam in every 10 th year.
Where all the money had gone? CSD canteen profits is redistributed to officers’ mess, JCOs Clubs, company fund in the ratio of 35%, 10% and 30% respectively with remaining amount ploughed back to URCs as CSD funds. Whereas all the rebates/contractual amounts being received from civil contractors, profits from non-CSD outlets being run by unit personnel are credited directly to the Company/Regimental funds.
The fund meant for officers’ mess is spent for maintenance and upkeep of the mess in addition to the mess maintenance allowance being received directly from the govt of India. Jco mess funds is utilised for the maintenance and upkeep of JCO’s Clubs by the order of the second in command who is the President of JCO’s Club by default. It is pertinent to note here JCOs are not authorise any JCO’s Mess hence such clubs are all set up adhoc by the services themselves engaging that many defence accommodation as JCO’s Messes.
Company funds on the other hand is spent ordinarily for modification for Commander’s official car, renovation of CO’s office& renovation of govt unoccupied buildings as officers guest rooms with 5 star comforts. Thus 80 % of the total expenditures from the company funds ordinarily is spent directly or indirectly for the benefits of the 5% of the officers in any military units/ formation HQs , all in the name of welfare of troops. Anybody raising a voice against the systemic rot is dealt severely with the help of draconian Indian Armed Forces Acts & Rules .
Question arises here why the profits from CSD , URCs, non-CSD outfits , commercial ventures on defence lands are not automatically credited to the govt exchequers. Why govt in the centre is not willing to get those Rs 1000 crores an year credited to its coffers and allot a few crores more for the welfare of the troops? Why such an existing policy exists where profits accrued from the CSD against investment from the consolidated funds of India is transferred to a fund which is considered private?
Why private ventures are required to be run by the armed forces personnel which regards its present strength far below expected level? Why private funds are required for the welfare of the troops questioning the very concept of maintaining a state’s defence forces to save guard its sovereignty?
To keep the input cost low govt of India allows various tax concessions to CSD as well to 4500 URCs. As a matter of fact regimentally held private funds with the armed forces as well as with defence departments are the only funds which are exempted from paying income taxes. As it is not scrutinised by the oversight committee, the income tax authorities do not collect taxes from the trustees of that huge Rs 1000 crore per year income group which could fetch a whopping Rs 3000 Crores per year at the least as income taxes. The states also looses an equivalent revenue as they do not impose sale, excise etc taxes on the sale of Rs 9640 per a year CSD goods through URCs.
In gist :-
It is not mandatory for govt of India to provide CSD facility to the troops. T can simply give some CSD allowance to compensate with one thousandth of the expenses made to keep the facility alive. That it can simply with draw the facility and auction those prime resources on auction to the likes of WALMARTS etc etc.
That troops can still be provided goods at rates cheaper than the market rates from those WALMART types Mall and Super markets on production of their identity or canteen smart cards. Govt can put such a condition while allowing auction of the CSD offices and the Depot for commercial purposes.
That by closing Canteen Stores Department altogether and divesting it to the highest bidders it can mop up more than the double of the 1.76 lac crores of auction money each year from those prime resources.
But who will do that? Some honest armed forces officers, some bureaucrats in the ministry of Defence, or some defence audit officers in the department of Controllers of Defence Accounts?
We know for sure those people who are the direct beneficiaries of that enormous loot and scoot will not come forward to stop such clandestine operation at the cost of the exchequers.
It is we , the people of India must demand it.
And now the solution:-
Let there be auction
Army units run their respective unit canteens through which subsidised stores ranging from Trucks/Cars to Bindies, from Refrigerators to Mosquito repellents, from Television sets to sanitary napkins, from ketch ups to imported liquors, from branded watches to non-branded agarbatties are sold. All serving soldiers, ex-servicemen, serving defence civilians, some para-military troops, Army school employees, Sainik school employees and students, URC employees and their dependents are allowed to avail such CSD facility.
Canteen Stores Department is a govt of India enterprise and huge amount money is spent to run the department with its Headquarters at Mumbai, Six Regional HQs at six different Metro locations and 35 CSD depots across the country. All at the govt’s cost. Besides bearing capital costs and the running costs to run this department exclusively for the welfare of the troops and their families it bears all the costs associated including pay, perks , pension , promotions for those central govt employees working for the CSD.
CSD though not exactly mandated but has taken the responsibility to provide CSD goods through its Retail Chains at rates cheaper than the prevailing market rates. For that Govt at the centre as well as at the states forego a substantial part of their taxes on goods procured by CSD, stocked in its depot and sold through URCs. There are no over head charges for the purchases made in bulk directly from the manufacturers as such cost is absorbed by the national exchequers to keep the input cost low. It sales the goods at a running profit of 2-2.5 % of the procurement price and claim to earn a profit of appx 250 Crores a year while govt at the centre bleeds to maintain such a white elephant at the cost to the exchequers. As per the existing policy, God only knows who penned that policy, 50 % of that superfluous profits (which does not take into accounts the capital costs as well as cost of maintenance to maintain that white elephant in the forms of pay, perks, promotions and such logistics for the thousands of CSD employees) is then transferred to the beneficiaries namely Army, Navy and Air Force under hand (It does not go through consolidated funds of India (sic).
At the other end URCs which are exclusive retail outlets of the CSD are run by the military as well as non-military units and the defence establishment on the supposedly vacant and rentable defence accommodations. There are 4500 URCs being run to sale CSD goods to the troops, Ex-servicemen and defence civilian personnel across the country. It is further growing to cater to the needs of ex-servicemen at the remotest locations of the country. It ends up making app. 500 cores of net profits per year. The profit earned at the retail outlets coupled with the largesse received from the CSD as per the existing policy is then converted into private funds by some tricks of the trade with Fin Min, Def Min, Def Audit, the Cabinet, the PMO and that all powerful CAG looking the other way all in the name of WELFARE to the Troops.
With URCs as the nucleus there are non-CSD outlets/private ventures being run by the units or defence establishments or outsourced to the civilian contractors /dealers. Neither the URC which sells CSD goods to the troops/civilians nor those commercial ventures being run on the defence buildings are authorised establishments of the union of India. They are all adhoc in nature and hence per force have to occupy some defence accommodations declared surplus as well as rentable. At a guesstimate there are appx 135000 (three times the number of URCs) such commercial ventures in operation on surplus rentable defence accommodations across the country besides 4500 URCs. A meagre Rs 5 per square meter of built up accommodation per month , decided by the local station commanders, is charged as Licence Fee and deposited to the govt exchequers for those surplus rentable defence accommodations which is considered damn cheap as such commercial ventures including the URCs make profits in crores. And with another twists to the tale A Rebate which ranges from Rs 1000 to a few crores is then collected from those civilian dealers/ contractors in addition to the Licence Fee and the allied charges egg water and electricity charges for use of those so called surplus rentable defence accommodations. At times over enthusiastic Officer Commanding Units ends up declaring recently built state of the art accommodations for newly acquired sophisticated military arsenals from foreign countries at astronomical costs to the nation as surplus & rentable to engage it for commercial ventures. There are instances where defence 1 lands are being used for construction of buildings funded from the non-public funds to cater to the growing needs to run more and more commercial ventures all for the WELFARE of the defence personnel. While licence Fee is deposited with govt of India at the rate of Rs 5 per sq mtr of built up accommodations for private ventures the Rebate which is appx Rs 500 per sq mtr end up being credited to the private accounts of the defence units. Besides there are nurseries for plants , for children , schools and colleges, Malls and Supermarkets, Golf Courses and Officers Institutes as well as clubs by the thousands across the country which are being run commercially and profitably. There are incomes from farm lands, garden produces and even from the petrol pumps and the fish ponds. All are being run for the Welfare of the Troops. A sum of Rs 500 Croes in the most conservative is the profits from those NON CSD private ventures. Together it makes whopping Rs 1000 Crores in the hands of a few commanding Officers who are at the mercy of the Generals and their equivalent in other two services /Defence Departments to make a kill all in the name of WELFARE of the troops.
The country is paying for its Army to protect its sovereignty. The country is paying for construction of the defence accommodations and military installations. The country is also paying for upkeep and maintain of its well trained Army. It is paying for its physical psychological and pathological needs to keep its Army motivated and disciplined. It is paying for its training, education, incidental expenses as well as for amenities. Is it averse paying a few thousand crores for some more WELFARE so that its Army is not COMPELLED to run private ventures from its so called private funds vacating buildings after buildings to declare it surplus as well as rentable compromising its integrity as well as its characters which is held in high esteem by the fellow citizens of this country? Should the govt of the day allows such activities compelling the such honourable Generals ( who does not compromise on anything including on his date of birth) to sale vegetables and cooking oils to earn profits and convert it clandestinely into private non-public funds just to avoid scrutiny by a couple of not so honourable audit officers from C& AG?
Let’s assume govt is committed to provide grocery and liquors to the troops at rates cheaper than the prevailing market rates as a WELFARE measures. Is the running of CSD at astronomical costs to the nation and compelling our honourable generals to establish a chain of URCs at even remotest locations to sale vegetable oils and Rum is the only alternative left with the govt of India? Recently Govt passed an executive order on the issue of FDI in multiband Retails in our country. In that it proposed that the willing Multinational companies across the globe have to invest a sizeable amount on development of back end infrastructures as well as to buy at least 30 percent of their products from the local farmers/manufacturers. Would it be very difficult to the govt of India to strike a deal with those the multinational, national, regional and local Multiband as well as Single Brand Retailers to provide liquors and stores to the troops on production of their smart cards at a rate cheaper than the prevailing market rates and earning the good wishes of the nation in addition. In this way our over burdened honourable generals, the BOCCS wherein Defence Min is the Chairman etc etc will be free from such sedentary duties which does not gel well with their high ranks and high offices.
If such thing is seemingly difficult to pass in the present political environment in the country with allies pulling the govt of the day in more than one side to cause instability would be difficult to actually auction those already existing URCs , Non-CSD outlets/private ventures including clubs , institutes, schools and colleges to the highest bidders on a yearly or such mutually beneficial terms and conditions centrally by an empowered committee with people of eminence drawn from their respective fields( Team Anna can be considered for the slot) as is being done for the liquor shops in all the states of India with an overriding directives that stores have to be sold at rates cheaper than the prevailing market rates. The amount of profits the armed forces is making engaging those honourable generals and their counterparts in two other services, in the defence departments there be no dearth of offers from our Desi-business houses who will jump at the god given opportunity to serve the troops.
The auction money along with the disinvestment money earned from auction of CSD enterprises along with the serving govt personnel and such other liability of the union of India will be astronomical. A fraction of the money will then be required to meet the just demands of our honourable generals for WELFARE of its subjects year after year. The money will be sufficient for the min of finance to support its flagship projects like Food Security Bill, MNREAG( even allowing Aruna Roy to get her minimum wages demands for MNREGA workers), RTE, RTI,establishment of more courts, appointment of more judges etc etc.
Will Congress led UPA II listen?
I thing we should get away with this canteen facility thing. Just to save a couple of hundred rupees per month Govt always penalise us. the latest example is sixth pay commisssion. and more over in this era of open economy we need not look toward the concession given by CSD facility.
This is the perpetual highhandedness at the cost of ordinary citizens of India and such continues to run in direct collusion with all concerned. Senior officials in IA-IAF-IN are hand-in-hand with each rather strategically connected for the common goal during the currency of their offices in respective def. forces and, of course, with “certain” blessings from the top, i.e., MoD, etc.
If the petition is properly drafted, I am of the view, that would bring perpetual guilty to book by the very hon’ble prudence of the Supreme Court.
Rabin Majumder
Advocate-on-Record
Supreme Court of India
Pls go ahead and bring the matter to its logical conclusion.
Don’t worry. My PIL is almost ready. It will take care of the root cause of the problem- Rakhshaks( Defence Audit Department) are the Bhakshaks (Min of Def incl the o/o the Def Min are in collusion ). Pl go through the draft( I have all the supporting documents held with me) and comment for add/delete to make it ROCKSOLID.:
To,
The Hon’ble Chief Justice of Supreme Court and his companion Justices of the Supreme Court
The humble petition of the
Lt Col(Retd) Haridas Mandal
Flat No 401 Ushodaya Apts
SV Colony,RK Puram
Secunderabad-AP-500056
Petitioner(s) abovenamed.
MOST RESPECTFULLY SHOWETH
1. The present petition under Article 226/32 of the Constitution of India is being filed by way of public interest litigation
and the petitioner has no personal interest. The petition
is being filed in the interest of entire range and depth of the citizens of this country who are paying taxes directly or indirectly to the govt at the centre as well as govt at the States including the Union Territories.
2. That the petitioner is a retired Army Officer who was commissioned in the corps of EME in the category tech graduate entry on 16 Dec 1978.The petitioner after serving 30 plus years in the Army was retired on superannuation at the age of 54 on 31 Jan 2009.During his service he had held important positions in the field of logistics in the Corps of EME. Besides techno-managerial duties he was assigned instructional as well as Regimental duties which included running of CSD Canteens (rechristened as URC later) selling CSD goods and liquors to the troops. The petitioner can therefore claim to hav intimate knowledge of the workings of the canteen services which is meant exclusively for the troops. The petitioner is filling this petition as a private person. The petitioner has earlier not filed any other public interest petition.
3. That the petitioner is filing the present petition on his own and not at the instance of someone else. The litigation cost and such incidental expenses is being borne by the petitioner himself.
4. That the facts of the case in brief are as follows:
4.1 The petitioner while in service posted to Army Base Workshop NRS Meerut(UP) during 2005-2007 came to know about distribution of dividends from the profits earned by the URC being run by Controller of Defence Accounts Meerut(CDA, Meerut) to each individual employees(From one his defence civilian employee whose wife was working in that office of CDA,Meerut).It was further revealed that amount of dividend paid to each employee according to scale of pay being received from the govt exchequers. It became clear to the petitioner that the graded dividends are highly beneficial to the top echelon of the CDA,Meerut.The petitioner made further enquiries on the subject as I was in the impression that Defence Civilians( paid out of Defence Estimates)were being extended CSD facility(Grocery Only)with some additional sale taxes as applicable to the respective states. The information on payment of dividends to each and every serving govt employees made the petitioner thinking on the issue further and study the system in depth.
4.2 By this time the petitioner was posted to 1 EME Centre NRS Secunderabad with effect from Dec 2007. In Jun/July 2008, under the provision of RTI Act 2005, the petitioner submitted a query each to the Controller of Defence Accounts (Officers Pune-1){CDA(O)} & Canteen Stores Department, Adelphi, Mumbai-400020{CSD,Mumbai} requesting them to state the auth under which CSD, Mumbai was issuing CSD goods to CDA Est/Staff to run their own URCs( Copy of the RTI queries are attached as at Appx A. CSD, Mumbai promptly responded stating that stores were being issued to URCs run by the CDA Staff/Est under provision of Army Order 19/2003 copy of the reply is att as at Appx B.
4.3 Armed with the reply recd from CSD,Mumbai the petitioner then asked RTI Cell IHQ of MoD , New Delhi to quote the auth “ Existing Policy” which found mentioned at Para 6(f) of Army Order 19/2003 under which Chief Of Army Staff(COAS) had authorized CDA Staff/Est to run their own URCs.It is pertinent to mention that Army Order 19/2003 was about COAS’s desire to open more URCs at non-military stations to benefit ESMs(Ex-Service Men) who find it difficult to avail this facility being far away from the URCs at the respective military stations( Extract of AO 32/84& 19/2009 are att as at Appx C). It was transferred to Dir(Q)&CPIO Room No 306, A wing, Sena Bhavan under Section 6(3) of RTI Act 05( Copy of the letter from RTI Cell att as at Appx D.It took some time and much more persuasion by the petitioner for the Army Authority to finally reply on the existing policy as referred to at para 6(f) of AO 19/2003. It was stated in their draft reply that Army Order under reference pertains to Quarter Master Branch which is the nominated nodal agency of the Board of Control Canteen Services{(BOCCS)wherein Hon’ble Raksha Mantri is the Chairman}to issue all policy instructions/directions/guidelines on behalf of the MOD. Accordingly the Army Order under Reference had been issued on the subject of URCs. It further stated that the facility(less liquor & AFD items)were extended to serving Defence Civilian employees paid out of Defence Estimates as a goodwill gesture for their support to the Defence Services consequent to a decision during the 53rd Meeting of the BOCCS.Relevant extracts of the same was also provided(a copy of the draft reply as well as the extracts of Minutes of Meeting as referred above are att as at Appx E.
4.4 According to para 22 of the minutes of Meeting of BOCCS held on 18 Mar 1986 “ —After a discussion it was brought out that all civilian employees paid from Defence Services Estimates and those employed in the under mentioned Ministry/Departments are permitted to make purchases from Services Canteens:
a) Min of Def, Min of Def(Fin)—.
b) Defence Audit Department.
c) Indian Defence Accounts Services who on deputation to posts other than those in the min of Def(Fin).
d)xxxxx
e)Civilian Employees of the Unit/Formation run canteens
f)xxxxxx
4.5 It was still not clear to the petitioner under what auth COAS inserted para 6(f) in Army Order 19/2003 to authorize CDA staff/Est to run their own URCs in the guise of publishing an Army Order to est URCs at the NON-MILITARY stations for the benefit of the ESMs. It is pertinent to note here that CSD Staff/Est are also running their own URCs a clause which even the COAS dared not to include in Army Order 19/2003.
4.6 As per para 1 under heading General of AO 19/2003 “ As per policy URC is given an independent registration number which facilitates it to draw stores from the dependent depot directly. Para 3 states “ In view of the above , it is felt that a new Army Order may be issued to permit the opening of URCs where no active unit is located .XXXX. As per 1 under heading of the same Army order “ the aim of this Army order is to lay down procedure for obtaining sanction ( by allotting new registration number) to operate a Unit Run Canteen.
4.7 Under heading 1 of Layout of the same Army Order ref above it is the BRIGADE/SUB AREA or Higher Formation Headquarters who are only empowered to sanction opening of Unit Run Canteen of their respective Area. It further states that Unit seeking sanctions wil submit applications to HQ BDE/SubArea as per proforma at Appx “A” subject to fulfilling conditions enumerated as at para 2 under heading Layout of Army Order 19/2003( Pl refer Appx , extract of AO 19/2003 already att). The Performa for seeking permission for running a unit run canteen for regular military Unit is as per appx A to Army Order 19/2003 where as for para military forces under operational command of Army is as per Appx B to AO 19/2003 copy of the each is att as at Appx F. As per Para 3 under heading LAYOUT of AO 19/2003 “ After according the necessary sanction the SubArea/Bde/Higher Formation Commanders will forward the application to CSD with a copy to the Unit certifying that the strength indicated comprises those eligible for CSD facilities under the rules. CSD Mumbai will register the Unit Run Canteen and forward a formal intimation to Sub Area/Bde /Higher Formation with a copy to the Unit. It was clear to the petitioner that all the 38 URCs being run by CDA Staff/Est had been sanctioned by the military commanders though none of them come under them in any manner. It was also deduced that each of those 38 URCs being run by CDA Staff/Est had also been issued with registration numbers by CSD Mumbai which is also not under the command and control of military commanders but directly under ministry of Defence.It was therefore necessary for the petitioner to confirm whether the URCs run by CDA Est/Staff had infact been sanctioned by military commanders at that location and duly registered by General Manager CSD, Mumbai who is the sole auth to issue registration number to any URC.
4.8 The petitioner set out to find the truth from the CDA est /staff as to whether those URCs been issued with registration numbers by the GM, CSD Mumbai. Controller General of Defence Accounts was kind enough to confirm that No of URCs being run by CDA staff/Est is 38 vide their letter No AN/II/3053/RTI/CPIO/Lt.Col Haridas/C.No 267 dated 14.11.2008 copy att as at Appx G.They further volunteered to add that CDA(O) Pune is running their own URC as per provision of Army Order 584/73( copy of the letter of CGDA EVEN No dated 14/11/2008 att as at Appx H) which simply mean that CDA Est/Staff are running their own URCs since 1973 and did not seek registration under the auth of Army Order 19/2003 which was published only in the year 2003. CGDA further informed the petitioner that registration number of URC of CGDA is 2489 and date of registration was 1974.But it refused to either confirm or provide the registration numbers in respect to other 37 Sub-ordinate CDA Staff/Est running their own URCs.And asked the applicant to obtain the same from the CDA Est/Staff on his own.CDA(O)Pune was however kind enough to confirm that their URC is registered as L4048 but refused to disclose the date of registration vide their letter No CSD/GROCERY/GENERAL dated 07/05/09 copy att as at Appx J.
4.9 It was time to confront GM, CSD Mumbai asking him to provide info on registration Numbers issued to 38 CDA Staff/Est run URCs vide his RTI query 35816/HM/RTI/43/09 dated 16 Feb 2009 addsd to CSD,Mumbai copy att as at Appx K. CSD, Mumbai responded quickly stating that info was being procured from other depot and will be provided on receipt vide their letter No 3/A-3/Legal/rti-33/2621 dated 19 Mar 2009 copy att as at Appx L.In Apr the petitioner was informed that the info requested could not be provided under the provision of Sec 8(1) of RTI Act 2005 vide their letter even No dated 09 Apr 209 copy att as at Appx M.
4.10 As per DDGCS ( Deputy Director General of Canteen Services vide their noting sheet dated att as at Appx(Enclosure No 1/ )Civilians of Defence Audit Department was extended CSD facility based on the decision of BOCCS( Wherein Def Min is the Chairman)held on 18 Mar 1986 , it can be safely assumed that such facilities wouldn’t have been already extended as early as from the 1973 in anticipation of such decision being taken by the BOCCS. Para 6(f) of AO 584/73 is the carbon copy of its counterpart as at para 6(f) of AO 19/2003.Further there was no decision taken during that meeting to allow CDA Est/Staff to run their URCs as it is contrary to the mandate of the Canteen Stores Department to provide CSD goods to the troops. It is therefore legitimate to assume there was no authority for the Army Commanders in the channel to sanction running of URCs by the CDA Est/Staff at their respective locations. It is also logical to conclude that GM, CSD Mumbai had erred in granting registration Numbers to URCs being run by CDA Est/Staff based on the recommendation/sanction of the military commanders as CDA Staff /Est does no way comes under their legitimate control as not being a regular military Unit or a para mil outfit temporarily under operational command of the Army.
4.11 Petitioner wish to put on record the recent replies received from the CSD,Mumbai denying information on the registration Numbers issued to URCs being run by NON-REGULAR MILITARY Units /Est under the provision of AO 19/2003 as AO 584/73 stand superseded. The petitioner has been denied info stating country security and sovereignty is at stake citing Sec 8(1)(a)and then “ URC” are not instrumentally of the state hence not covered under RTI Act 2005. It is amply clear that neither Min of Defence , nor Army Auth nor GM CSD, Mumbai has any legitimate auth / mandate to allow CDA Est/Staff to run their own URCs irrespective of whether they are run for the welfare of their employees and not profits etc etc.
4.12 The petitioner has approached the Director General of Defence Audit, The Comptroller & Auditor General of India , The BOCCS( wherein Defence Min is the Chairman), The Ministry of Defence ( In case QMG which is the nodal agency for Canteen Services) failed to bring it to the notice of the Defence Minister , The Fin Minister as well as DAPRG for info Prime Minister of this country. I have not received any information whatsoever that the matter is being investigated or action already taken to cancel registration of those 38 URCs in particular and others who are also been allowed (namely more than 35 URCs being run by CSD staff/est)to run their own URCs.
4.13 The question arises here as to how the citizen of this country is being affected if such URCs are being allowed to run on the vacant govt buildings( By intentionally relocating govt offices to run such URCs)funded by the so called non-public funds? It will be worth considering here to refer to the performance audit report of the Comptroller & Audit General of India on Canteen Stores Department which is reproduced below verbatim:
4.14 It can be seen from the report all is not well in the URC front. But the petitioner is not find faults in the running of URCs but to question the running of those URCs being run by CDA Est/Staff. It is unfortunate that office of the CAG did not deliberate on this very pertinent issue as the registrations was issued by CSD , Mumbai and CAG was not required to approach any body to examine each and documents related to the applications , recommendations of the Military commanders up the channels, the questionable auth of the Army Order 584/73 as amended by AO 19/2003 and 2/2006.
4.15 Financial burden on the exchequers to provide CSD facility to the troops is directly proportional to the strength of the Armed Forces and the dispersal of the units running their own URCs fulfilling the conditions laid dowm. Further it is dependent on the numbers of URC in operations as resources to be made available to the CSD auth to procure and issue stores are enormous. As the resources required is directly proportional to the strength of the clienteles it is obvious that Govt of India is profusely bleeding to provide CSD stores to troops plus civilians which is more than the double the troops.
4.16 Once again the petitioner wish to inform the hon’ble judges that this petition is not intended to question at this juncture expansion of clienteles due to inclusion of civilian employees as refereed at para 12(b) of AO 2/2006 but is determined to question the auth of GM CSD to admit application from the CDA Staff/Est and issue registration numbers to run their own URCs.
4.17 When confronted with the evidence that CDA est/staff in fact were registered even before BOCCs met and decided to extend CSD facility to Civilian personnel right from the year 1973 supposedly based on AO 584/73 the military auth ( DDGCS to very precise) has now come out with a letter document issued by Army Headquarters unilaterally deciding to extend CSD facilities to Civilians including the defence audit employees wherein they were allowed to avail csd facility from the service canteen. No document is on record or produced by Min of Def,The CSD , the CDA , Military Commanders at any level to show that CDA Est / Staff are authorized to run their own CSD canteens. It is but natural to dismiss the auth of an Army Order namely Para 6(f) AO 584/73 or 19/2003 cause such enormous financial burdens to the tax paying citizens of India.
4.18 As is highlighted not only profits accrued at the URC level a huge sums of money from the profit at the CSD end is also getting transferred to the respective URCs in the grant in aid , QD , reimbursement of transport charges etc etc. Keeping the URCs run by the regular military units for a moment to concentrate on the issue at hand it is therefore tax payers money legitimately earned is being transferred to those illegitimately run URCs by the CDA Est/Est. And where the entire profits including the share of profit from the CSD recd go ? It is then paid as a dividend to each and every employee of the CDA Est/Staff proportionate to their grade pay.
4.19 What is wrong if some amount of profits is paid as dividends to the poor employees- could be the next question. Controller of Defence Accountants is supposed to be country’s premier watch dog which is to keep an eye on every penny spent by the ministry of Defence. If that premier agency is allowed to run illegitimate URCs by the dozens occupying more and more govt accommodations to increase more sales vis-a-vis increase profits on sales and as well as the share from the CSD, Mumbai will it retain its sharpness while dealing with wrongful expenditures made by the chiefs of the three services , the heads of the defence departments including the CSD , Mumbai which has issued registration number to felicitate running of URCs by the dozens? The answer is No. And this is reason why the petitioner wish to bring direct as well as indirect loss ( due to poor quality of audit intended or under dures) to every citizen of this country to the fore. It is not only the question of quantum of direct loss due to such wrongful activities by the CDA Staff/Est in collusion with the big wigs in the Military Est, bureaucrats at the ministry of Defence as well as Min of Fin but appeasement of the country’s watchdog which is many times the direct loss.
4.20 URCs as Nucleus there are thousands of Shops and restaurants, mini to Big markets have come up on the defence premises. The profits in the forms of rebates , commission & profits being generated by CDA est/staff is astronomical. It is open call for the employees of the CDA Est /Staff to put more hard work for successful operation of such umpteen numbers of commercial activities instead of scrutinizing financial documents to unearth financial misappropriation which will no good to their health or even career. A large number of govt accommodations are therefore under seize and being offered to the civilian contractors to run their own shops in and around URC. Thus one illegal sanction is compounding into many such illegalities costing lacs and crores to the exchequers as at the end quality of audit is the casualty.
4.21 As per the latest 3 judges bench ruling on the question of status of URC employees vide SC Civil Appeal No 3495 of 2005 decided on 28 Apr 2009 , URC are private ventures. If that be so it is to be decided by the hon’ble judges of the Supreme Court whether CSD, Mumbai to close the shop all together as it is nowhere mandated to provide CSD stores to the troops ( para of the same SC order). Alternatively govt of India can think of auctioning such outlets including URCs being run as private ventures the highest bidders. The money thus will be enough to fund MNREGA,RTE, RTI,JUDICIARY in addition spending enough for the welfare of troops as is being fondly claimed by even the CDA Est/Staff.
4.22 It is therefore amply clear there is no mandate for CDA Staff/Est to run their own URCs notwithstanding content of para 6(f) of Army order 19/2003( AO 584 /73 stand superseded) as it had no locus standi. Further issue of registration numbers by the GM , CSD Mumbai to those CDA Est/Staff based on their application duly sanction by the formation commanders of the army has no legitimacy. No concrete evidence on record that establishes that people’s mandate was ever obtained to allow CDA Est/Staff to run their own URCs for making profits and then sharing it in the most clandestine manners. It is the worst type of appeasement by the military commanders, the senior bureaucrats in the ministry of Defence to allow CDA Est /Staff to run their own URCs knowing it to be illegal in all aspects. Appeasement of the controllers of Defence Accounts Staff/Est has degenerated the quality of audit of defence account at all levels is the root cause for MEGA SCAMS in the armed forces as well as in the Defence Department which is a very large monolithic Department.
5. The source of information of the facts pleaded, is based on __documentary evidence, physical verifications, interactions with the colleagues in arm, CAG’s performance reports, Experts’ comments from the social network for the lawyers/practising advocates and personal experience of 30 years being in the Army.
6. That the petitioner has sent representation in this regard which are listed chronologically below:
i) To CGDA, New Delhi vide letter No dated and reply recd copy att.
ii) To CAG New Delhi vide letter No & their reply thereof
11) To CVC online
IV)To min of Defence.online
v) To Min of Fin online
vi) TO DAPRG online.
7. That to the best of knowledge of the petitioner, no public interest petition raising the same issue is filed before this Hon’ble Court or before any other court.
8. That the present petition has been filed on the following amongst other grounds: GROUNDS
State separate grounds with specific mention of violation of particular constitutional or statutory provision or any
administrative instruction. The relevant provision of the Constitution and statute must be quoted and administrative
instruction must be filed.
9. That the petitioner is seeking interim relief on the following grounds: GROUNDS FOR INTERIM RELIEF
Specify grounds for grant of interim relief and the nature of urgency involved.
10. That the petitioner most respectfully prays that this Hon’ble Court may be pleased to pass the following order:
PRAYER
Set out the prayer/relief claimed (if more than one relief is claimed, separate prayers may be made for each relief).
11. That the petitioner most respectfully prays that this Hon’ble Court may be pleased to pass the following interim order
pending final decision: PRAYER FOR INTERIM RELIEF
Set out interim relief claimed (if more than one relief is claimed, separate prayers may be made for each relief).
DRAWN & FILED BY
Advocate for the petitioner
Place:
Date:
—
>
+ Extract from speech delivered in the lecture series organised by the Supreme Court Bar Association at NTo,
The Hon’ble Chief Justice ____ and his companion Justices of the ________
The humble petition of the
Petitioner(s) abovenamed.
MOST RESPECTFULLY SHOWETH
1. The present petition under Article 226/32 of the Constitution of India is being filed by way of public interest litigation
and the petitioner has no personal interest (if he has any personal interest such interest must be disclosed). The petition
is being filed in the interest of ______ (give particulars of the class of persons for whose benefit the petition is filed).
2. That the petitioner is (give short background of the petitioner; if the petitioner is an organisation, the names of the
office-bearers must be furnished). The petitioner has earlier filed/not filed any other public interest petition (if filed, details
of such PIL filed including the case number and the court, status and brief description of the order passed must be given.
It must also be stated whether in any of such cases any cost has been awarded for or imposed against the petitioner;
and whether any appreciation or stricture has been passed).
3. That the petitioner is filing the present petition on his own and not at the instance of someone else. The litigation cost,
including the advocate’s fee and the travelling expenses of the lawyer, if any, are being borne by the petitioner himself (if
not, the petitioner must disclose the source of funds).
4. That the facts of the case in brief are as follows: (narrate the facts leading to the filing of the petition in chronological
order by marking paras as 4.1, 4.2 and so on).
The Practical Lawyer
http://www.supremecourtcases.com Eastern Book Company Generated: Thursday, December 1, 20115. The source of information of the facts pleaded, is based on _______. (If news report, whether the applicant has
verified the facts by personally visiting the place, talking to other people or from the reporter/editor of the newspaper
concerned. If the petitioner does not wish to disclose the source, he may say so with reasons).
6. That the petitioner has/has not sent representation in this regard. (If yes, details of such representation and reply, if
any, from the authority concerned along with copies thereof must be filed. If not, reason for not sending such
representation).
7. That to the best of knowledge of the petitioner, no public interest petition (whether filed by the petitioner himself or by
anyone else) raising the same issue is filed before this Hon’ble Court or before any other court. (If filed, details thereof).
8. That the present petition has been filed on the following amongst other grounds: GROUNDS
State separate grounds with specific mention of violation of particular constitutional or statutory provision or any
administrative instruction. The relevant provision of the Constitution and statute must be quoted and administrative
instruction must be filed.
9. That the petitioner is seeking interim relief on the following grounds: GROUNDS FOR INTERIM RELIEF
Specify grounds for grant of interim relief and the nature of urgency involved.
10. That the petitioner most respectfully prays that this Hon’ble Court may be pleased to pass the following order:
PRAYER
Set out the prayer/relief claimed (if more than one relief is claimed, separate prayers may be made for each relief).
11. That the petitioner most respectfully prays that this Hon’ble Court may be pleased to pass the following interim order
pending final decision: PRAYER FOR INTERIM RELIEF
Set out interim relief claimed (if more than one relief is claimed, separate prayers may be made for each relief).
DRAWN & FILED BY
Advocate for the petitioner
Place:
Date:
—
>
+ Extract from speech delivered in the lecture series organised by the Supreme Court Bar Association at N
Earlier in 1977 when CAG observed that CSD which was functioning as private commercial unit, their fund were not regulated through CFI.The govt accepted the suggestion of CAG and CSD department converted into full flagged govt department , their funds regulated through CFI. Since the UNIt Run Canteens (URC) are the out lets of CSD and the whole retail work done by the URC, if URC stop their function, CSD will automatically closed down. Actually turn over of the URC is the turnover of CSD. If URC do not purchase stores from CSD than the CSD will totally nonfunctional. Therefore, the URCs are also the govt department but the three services very cleverly kept these URCs out of the CFI and shown them as private and out of govt audit so that their profit in crores every year can be used by them self without any permission of the govt. In the another word it is totally scam and misuse of govt fund in the name of ‘Non public fund. Now the CAG has rightly pointed out. The matter is under investigation of PAC and if the PAC approve the CAG report, the govt should take over these URC’s immediately to save the misuse of the public money.
TS Chauhan, EX. Secretary General AIDCCEU
Dear friends, a big scam, which is ever before been happened / revealed in Indian history is going to be investigated shortly. Just wait and see a number of culprit officers will thrown out from service without pension. Though the URC employees may not get the benefit of CAG audit immediately , but in the nearest future they will win and the evil elements will be pushed to hell.
This is a matter of extreme exploitation of Unit Run Canteen (short URC) Employees by the Indian Defence Forces, Misappropriation of Govt. Money and a big Scam and Scandals of Defence Forces. The matter is also indicated by the Comptroller and Auditor General of India (CAG) in its PA Report No. 14 of 2010-11on CSD and URCs, which has been submitted in the Parliament on 13 Aug 2010 and the action of PAC is yet awaited.. The URCs are the retail outlet shops of Canteen Stores Departments (short CSD), The CSD is an organization of Govt. of India, Ministry of Defence. There are total number of 35 CSD Depot established in all over country which are totally depends upon the 3709 URCs for sale of its articles to the entitled personnel. In comparison of annual turn over of CSD vis Rs. 6955.11 Crores the annual turn over of URCs is Rs. 7441.96 Crores. Every year a huge profit has been generated by the URCs. This earns approximately Rupees 525.94 Crores net profit annually. In addition to this profit, these Canteens (URCs) are also getting approximately a sum of Rs. 200 Crores yearly as Quantitative Discount (Q.D.) from consolidated fund of India through CSD. But unfortunately there is no provision of audit of this Public money by the CAG and Director General of Audit of Defence despite of Defence Ministers’ approval. This situation is shameful for India. In my opinion neglecting the Minister’s order should be treated as contempt of Indian Constitution.
BHARAT BHUSHAN KHULBE, SECRETARY GENERAL, AIDCCEU, 08802849110(Mob)
As per three Services, these are privately run canteens by the Units.
So, where is the problem. I wonder if it will be cost effective for CAG to deploy staff to undertake this massive exercise. Does not make sense.
Dear Mander I would like to suggest you please go through the report of the Comptroller and Auditor General of India Performance Audit of Canteen Stores Department (Ministry of Defence) Union Government (Defence Services) No. 14 of 2010-11, which has been tabled/laid by the C & AG in both houses of Parliament on 13 Aug 2010.
Housed in Govt place, run by uniformed personnel, govt transport is used, then what is the objection for CAG audit because its full of corruption and that will be exposed like the golf grounds, APS …..
I think defence forces senior army officer will never get permission to audit the URC. RM should intervent on the above matter. All money should go to govt treasury.
vcr