ISLAMABAD - About 1,562.097 acres of railways land valuing Rs67,932.58 millions is encroached by individuals and departments, it has been observed by the Auditor General of Pakistan.

The auditor general of Pakistan has observed irregularities to the tune of billions of rupees in the accounts of the Pakistan Railways.

During the audit of accounts of different units it was noticed that about 1,562.097 acres of railways land valuing Rs67,932.58 million was encroached upon by individuals, government departments, FC, Rangers, Board of Revenue Punjab, and Revenue Department Sindh, said Audit Report 2015-2016 of the Pakistan Railways.

ALIYA TOWN, LAHORE LAND

In a separate case, the audit team has noticed unauthorised occupation of land, worth Rs4,017.02 million, due to negligence of railways management.

It was noticed that the railways land valuing Rs4017.02 million situated in Aliya Town, Lahore was encroached due to un-demarcation.

DHA BAHAWALPUR LAND

The audit team has also recorded irregular/unauthorised sale of railways land worth Rs79.80 million by the Government of Punjab.

During audit, it was noticed that 12.5 acres of railways land was sold by the Government of Punjab to Defence Housing Authority (DHA), Bahawalpur near Mouza Hot Wala.

ILLEGAL HOUSING SOCIETY IN HYDERABAD

Unauthorised mutation of leased out railways land worth Rs39.06 million was observed.

It was noticed that 5,478 square yards of railways land worth Rs39,058,140 (at DC rate of Rs7,130 per sqy) near Indus Glass factory Latifabad, Hyderabad was leased out for a period of 99 years in 2010.

Scrutiny of the record revealed that the lessee illegally mutated the said land in his favour and got approved a housing scheme from Hyderabad Development Authority.

However, no action was taken by the Railways authorities so far, the audit report said.

ILLEGAL ALLOTMENT BY SINDH

INDUSTRIAL TRADING ESTATE

The loss of Rs59.51 million on account of unauthorised allotment of railway land and non recovery of rental charges was also observed.

During the audit, it was noticed that the Sindh Industrial Trading Estate illegally allotted 10,600 square yards of railways commercial land worth Rs23.32 million to a private party in 2007.

This resulted in loss of Rs36.19 million to Pakistan Railways on account of rental charges.

NON-REALISATION OF BILLS FROM

DEFENCE SECTOR; FOOD, OIL COMPANIES 

Similarly, the audit has noticed that the railways have non-realisation of bills receivable worth Rs3,616.62 million.

It was observed that the position of bills receivable of Pakistan Railways as on 30 June 2016 was Rs3,616.62 million that have accumulated over the years from 1967-68.

Out of these bills receivable, an amount of Rs840.05 million was more than five years old, recovery of which was uncertain.

Major portion of receivables pertained to defence, food and oil companies, the audit report said.

The bills receivable have seen a very sharp increasing trend. Under this head, an amount of Rs1,152.40m was receivable in 2005-2006 whereas on 30th June, 2016 it reached Rs3,616.62m.

An increase of 213.83 per cent has been noticed under this head from 2005-2006 to 2015-2016.

IRREGULAR PAYMENT IN SIGNAL PROJECT

Irregular payment of Rs934.72 million was made on account of incomplete design work of system engineering of signal project.

Under an agreement for the provision of signalling system on Khanewal to Shahdrabagh section it was provided that total system engineering price $10,326,169 shall be paid to the contractor, who shall complete and submit all designs in respect of 31 stations starting from 24th March 2010 to September 2010.

Contrary to the provision of contract, it was observed, the project management made irregular payment of $9,347,226 (Rs934.72 million) to the contractor without completion of work relating to the system engineering, which was the prerequisite for installation of computer-based interlocking signalling system.

Reportedly, system engineering of 22 stations could not be completed up to November 2016.

NON-REPLACEMENT OF DEFECTIVE

MATERIAL

Loss of Rs423.91 million was incurred due to non-replacement of wrong/defective material.

It was observed that contractor supplied either defective or material of wrong specification.

Railway management failed to get the replacement of material worth Rs423.91 million even though its payment had been made.

UNNECESSARY PROCUREMENT OF CRANE

Unnecessary/irregular procurement of Hydraulic Telescopic Boom Crane worth Rs200.55 million was also noticed by the audit team.

In the PC-I of 87 kilometres Complete Track Renewal (CTR) Lahore there was a provision of Rs81 million for crane, however an expenditure of Rs200.55 million was charged to the project on account of purchase of one Hydraulic Telescopic Boom Crane.

PROCUREMENT OF DIESEL GENERATOR SETS

The audit further noticed irregularities in procurement of diesel generator sets and wasteful expenditure on power van shells thereof Rs194.66 million.

As per the contract between Pakistan Railways and MS Power International Company Limited, the supplier was required to provide 30 DG sets of 300-KVA Perkins UK origin, along with accessories.

However, it was observed that the 30 DG sets and accessories provided by the contractor were not per the specification.

Cancelling the contract was recommended.

Instead of cancellation, the contract was amended and the origin country’s name was changed and the DG sets were accepted by the Railways management irregularly. 

IRREGULAR PAYMENT FOR TRACK

CIRCUIT MATERIAL

Irregular payment of Rs930.9 million on account of track circuit material was observed.

During the audit of the project director/signal Lahore it was observed that the project management paid an amount of $9.309 million (Rs930.9 million) to the contractor on import of track circuit material including impedance bond for installation of Computer-Based Interlocking (CBI) system.

Notwithstanding, impedance bond has been excluded by the project management on the plea that it was not required and thus was not supplied by the contractor.

However, full payment was made to the contractor irregularly, the audit report observed.

OTHER IRREGULARITIES

Other main irregularities observe by the audit includes, unjustified expenditure on account of overtime allowance Rs302.49 million, irregular/unauthorised depositing of Rs7.92 million of railways earning in private accounts, loss of Rs18.87 million due to irregular promotion of contract employees, loss of Rs17.86 million due to purchase of defective machines, loss of Rs9.75 million due to non-recovery of liquidated damages charges, irregular payment of Rs5.5 million for the hiring of staff over the age of 65 years, loss of Rs4.28 million due to purchase of wooden battens at higher rate, and unjustified expenditure of Rs5.49 million on the procurement of 100 laptops.

The AGP has recommended taking action against those officials of the Pakistan Railways who are responsible for the irregularities.