Army says no rules violated in response to defence ministry's audit report

Last Updated: Wed, Oct 24, 2012 04:32 hrs
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New Delhi: The Indian Army, contesting the reported loss of Rs.100 crore in procurements, has said that no rules were violated.

Responding to a Ministry of Defence audit report, which questioned the way army commanders were spending money for urgent procurement, it said that all announcements on procurements were done as per established guidelines.

The defence ministry's audit has found 55 cases where procurements were made without consulting centralised agencies.

The ministry's scanner is on a questionable expenditure of Rs.125 crore, which has prompted Defence Minister A.K. Antony to order the imposition of strict checks and balances.

The Defence Ministry had earlier ordered the Controller of Defence Accounts (CDA) to audit expenses made by army commanders under their special financial powers of up to Rs.125 crore to procure urgently-required items for troops.

The audit report has assessed 55 transactions made by various army commands between the years 2009 and 2011 when present Army Chief Gen Bikram Singh was heading the Kolkata-based Eastern Command.

The report suggests that certain equipment, including Chinese communication equipment, had been purchased from grey market.

Mismanagement in milk procurement in Northern Command has also been suggested by the report.

It also mentions the procurement of binoculars by the Eastern Command from a foreign vendor when the same were available at lower prices in the Indian market.

Commanders of the army's northern and eastern commands have the authority to sanction procurement expenditure of around Rs.125 crore and Rs. 50 crore respectively. The other four commands can sanction expenditure upto Rs.10 crore each.

The internal audit report has so far claimed a loss of around Rs.30 crore in procurement of special packaged milk in the Northern Command.

The report has also suggested a review of the special financial powers of army commanders and other officials. 

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