Response-Audit Report on Jalayagnam-Vol.1

7/27/2019 Response-Audit Report on Jalayagnam-Vol.1

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Response ofIrrigation & CommandArea Development Department

to the Draft Performance Audit

Report on

JalayagnamVol. 1

Irrigation & CAD Department.

Government of Andhra Pradesh

July 2012

V

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Table of Contents

Sl.No.

Name of the Para

Reference to

Paragraph

1 Over view 1

2 Audit Frame Work 2

3 Planning 3

4 Selection of Process 3.1

5 Assessment of water resources 3.2

6 Project formulation 3.3

7 Requirement of Power 3.4

8 Provision of Standby Pumps 3.5

9 Benefit - Cost Ratio 3.6

10 Inter-State issues 3.7

11 Project Approvals 3.8

12Taking up of Projects without fulfillment ofPre-requisites

3.9

13 Tendering and Contract Management 4

14 Empanelment of Contracting agencies 4.1

15Cartelization/Suspicious and unfairtendring practices

4.2

16 EPC System of Contracting 4.3

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I&CAD Department sincerely expects at least for now, the information

given in the accompanying document will result into suitable

modifications of the draft Report. In any case, the version given by the

Department shall also be included before passing any verdict in the

final Report. It is also expected that the final Performance Report on

Jalayagnam will also appreciate constraints faced by, and corrective

steps taken by the Department from time to time. The final Report will

not be a mere indictment and will also come out with the concrete

constructive policy and other suggestions to be implemented at the

Government and field levels.

Genesis of the Projects under Jalayagnam

It is important now, to explain how a project is approved and

implemented in the public sector. In this connection, the first and

foremost is the felt need for having such a project. Based on felt need,

techno-economic feasibility and viability of a project is assessed. Only

such viable projects after obtaining necessary financial concurrence gothrough a process leading to the administrative approval. Those

projects having techno-economic viability, financial concurrence and

the requisite political will (with technical and administrative sanctions)

are implemented. This entire process is not static but a dynamic one

based on the analysis of ground realities. This often, leads to

variations between line and detailed estimates. It does not mean that

one is correct and other estimate is inflated or incorrect (unlesssupported by corroborative evidence). Any one conversant with basic

project management, knows that even detailed estimates (thats why

called estimates) depend upon a number of variables such as designs

etc., that evolves over a period of time. Before pronouncing any thing

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fishy, the concerned agencies are supposed to verify facts, try to

appreciate reasons and come to an informed conclusion.

Detailing is possible to an extent and no system can take into account

several emerging internal and external factors. In addition due to

various reasons, a few projects though, having necessary

administrative sanctions are not grounded for quite some time. As and

when such projects are grounded, it leads to inevitable cost escalation.

However, such incidents are part of contemporary public policy. Table

1 below gives a comprehensive picture of all 86 projects including 4

projects yet to take off though all taken up under Jalayagnam.

Table 1: No of projects sanctioned in a financial year and Amount of

Administrative approval of these projects

(Amt. in Rs. Crs.)

SN Financial

Year

No. of

Projects

Original admn.

Sanction1 Prior to 2003-04 8 785.152 2003-04 4 1353.893 2004-05 36 71727.144 2005-06 6 2397.165 2006-07 3 4643.686 2007-08 10 11313.177 2008-09 15 75488.48

82 167708.97Source: PMU of I&CAD

In addition to the above 82 projects, due to various reasons 4 works

sanctioned in 2008-09 amounting to Rs.17900.69 crores under

Jalayagnam had so far, not been grounded. Some of the other projects

such as Head works of Indira Sagar Polavaram Project (ISPP), delta

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modernization and flood banks though, grounded had not yet been let

out to the full extent of their administrative approval.

As it could be seen from the Table 1, Jalayagnam is meant not only for

sanctioning new projects but also aims at completing projects

languishing even before the launching of this Program prior to 2004-

05.

Prior Scrutiny of Jalayagnam Projects by PAC

It is pertinent to mention that in the last 4 to 5 years many of the

irrigation projects taken up under Jalayagnam had already been

audited by the Principal AG and as well as, also examined by the Public

Accounts Committee (PAC). The department had also furnished

detailed information on various irrigation projects to the Secretariat of

AP Legislature as desired by the PAC as per details given in Annexure

I. It goes without saying that Principal AG and other officials of the

O/o Principal AG were active participants in all the PAC meetings. Thecopies of these documents were also as well, handed over to the

Principal AG.

Some of the issues raised in the draft Performance Audit Report had

been deliberated upon, and a considered view had already, been taken

by PAC on certain substantive issues. It defies the conventional logic

and rationale of once again raising these issues in the form of aconsolidated draft performance report even after the superior body

(PAC) had examined several related issues including CAG paragraphs.

However, the point wise detailed rebuttal is given in the successive

paragraphs of this document.

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The stand of department had time and again, been articulated in the

PAC meetings and is reiterated even in this document. In view of

enormity of Jalayagnam projects (both in terms of numbers and size),

the department resorted to parallel processing of the desired set of

actions. This approach is different from the sequential processing

approach articulated by the O/o PAG. In other words, PAG essentially

suggests so as to first complete the design, investigation and survey of

the projects to be taken up; do the land acquisition (including

acquisition of forest land, wild life sanctuary etc.); then go for various

statutory clearances (in principle site clearance from MoEF, stage one

forest clearance, deposit Net Present Value of forests and cost of

compensatory afforestation; seek stage 2 forest clearance, obtain

approval of the wild life board, clearance of Ministry of Tribal Affairs,

go for approval of various directorates of Central Water Commission,

TAC clearance of Ministry of Water Resources, and lastly investment

clearance from the Planning Commission) before awarding the work to

various contracting agencies. This suggestion is too simplistic tofollow; and also overlooks contingencies arising out of various court

cases and other litigation; and suggests uniform process for all the

irrigation projects.

Several passing comments had been made such that investment

clearance from the planning commission for the projects on interstate

rivers and their tributaries is mandatory; taking up execution ofprojects without obtaining investment clearance is not only violative of

the constitutional provisions, but is also likely to run in to trouble at

the time of releasing water since Andhra Pradesh is down stream state

for most of these rivers etc. Year wise analysis of river water going

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into Bay of Bengal (Table 2) indicates huge variations. It is once

clarified that there is no legal or constitutional hurdle for the lowest

riparian state to plan and implement certain flood water based

irrigation projects.

Table 2: Variations in Annual flood flows of major rivers in Andhra

Pradesh

(surplus discharges in TMC)

Name of theRiver

Maximum Minimum

Godavari 6081.07(1994-

95)

682.4(2009-10)

Krishna 1329.304(1994-

95)

2.281 (2002-03)

Vamsadhara 197.268(2006-

07)

31.561(2000-01)

Pennar 117.18(2001-02) 0 ( in many years)

Source: EnC (Irrigation)

Allegation that no comprehensive study was undertaken by the State

Government before taking up Jalayagnam to review (1) the quantum

of utilizable water available to state (2) quantum of water being

utilized by the existing projects (3) balance water including flood water

available for utilization in new projects is strongly refuted. The

comment that there was no evidence to indicate that the flood data of

Krishna and Pennar rivers was analyzed to access the average number

of days where flood flows are available annually and average annual

total flood discharge is also out of place. As every river basin is unique

and is different from any other basin, the question of adopting uniform

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number of flood days for designing the projects that use flood flows

does not arise.

There is also a lot of criticism in the Draft Report about the

Engineering, procurement and construction (EPC) system as adopted

by Andhra Pradesh for Jalayagnam projects. It is incorrect to say that

the tendering and contracting process lacked transparency and

financial interest of the state for not safe guarded. The following steps

taken by the Department for system improvement, increased

transparency and better quality control further reiterate evolutionary

EPC system:

Measures taken for system Improvement:

Jalayagnam, being an ambitious task with unprecedented level

of challenges in implementation, the State Government had from time

to time, taken several conscious decisions to streamline and improve

the overall procurement process for ensuring timely execution of works

with quality and overall transparency.

(i) EPC Methodology: Keeping in view, the available manpower in

the department as well as complex technical nature of the works in

terms of design and introduction of latest technology, Government

took a decision to go with internationally recognized and proven EPC

methodology. The same methodology has also been used by some of

the large Government of India Institutions. Major and mediumprojects were in turn divided into different packages. This was to

ensure that major construction companies take up such work and

bring in the latest technical know-how at a competitive price /rate.

Under this system, the agency awarded with the work, has to take up

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the investigation, survey, designs and construction of their package on

a turn key basis. In this system there will not be any scope to account

for deviation of quantities, revision of estimate etc. The EPC system

adopted in Andhra Pradesh was however, different from internationally

recognized EPC on more than one count. Internationally, there is no

cap on the tender premium. However, it was fixed at 5% and any

tender over this cap was bound to be rejected in Andhra Pradesh

Model. Similarly, tender value quoted below a certain percentage of

IBM, the bidder is expected to provide additional performance security.

Under the Andhra Pradesh system the price adjustment provision is

followed in respect of only 4 components Steel, Cement, POL and

Metals used in Electro Mechanical components; while global EPC allows

for price adjustment for all components including that for labor and

material especially, beyond agreement period.

Another positive aspect of EPC methodology is that investigation and

design for the complete project is taken up. Tenders have been called

for all the projects, keeping in view that project conceptualization canbe done comprehensively this way. It has also facilitated timely and

speedily requisitions being given to land acquisition authorities as

there are several EPC agencies conducting survey and investigation. It

also ensures that land is available in advance and government need

not face constraints of non availability of land at critical stages of

projects when the costs will be higher and projects will be delayed. It

has been attempted to match the milestone fixed, financial outlay andtargeted dates for completion of the projects under this system.

(ii) E Procurement: The entire tender process has been made

through a well established e-procurement process where, all the

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information is available on line. Guidelines in consultation with IT

department are being followed.

(iii) Rationalization of Internal Bench Marks (IBMs).: A high

level technical committee looks into finalization of IBM for all these

EPC packages consisting of Advisor/ Senior Technical Officers to the

Government, Chief Engineer, Central Design Office and concerned

Project Chief Engineer. This is to ensure the rationalization of

estimates for consistency and uniformity in the approach. The central

design office had also communicated certain standard drawings,

designs and specification to all concerned for bringing uniformity,

reducing errors and cutting down delays.

(iv) Institutional & Administrative Mechanism: A State Level

Standing Committee undertakes technical and financial evaluation of

the bids received. The committee consists of Engineer-in-Chief, Chief

Engineer, Designs; and Commissioner of Tenders, Chief Engineer

(Projects) and a representative of Finance Department (DFA). Therecommendation of this state level Technical Evaluation Committee is

further examined by the High Power Committee/ Committee of

Secretaries. All the major packages beyond Rs 100 crores go to

High Power Committee which is chaired by the Chief Secretary. These

recommendations are taken into consideration by the Government

before acceptance of bids. An Advisory committee has also been

constituted to deliberate upon technical issues and also opine uponprovisions of agreement as to an item of work is covered in it or not.

They also brainstorm on further improvements.

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(v) Land Acquisition: Over 6 lakh acres land for both projects site

and submergence area had been acquired by I&CAD Department for

Jalayagnam project through the methodology of consent award. This

prevents litigation and future cost escalation. Innovative arrangements

for expediting land acquisition were made by constituting District &

State level negotiating Committees with suitable delegations

facilitating consent awards and litigation free land acquisition.

However, this step had not overcome litigations due to political and

other reasons. Despite taking all the possible care, some critical

patches of land acquisition are still sub-judice.

(vi) Quality Monitoring Systems (Involvement of independent

agency, multi-pronged approach): The Government has given the

utmost importance to the maintenance of highest standard of quality

in all these works. Detailed quality guidelines have been issued to the

field Engineers and close monitoring of quality standards have been

ensured. The present arrangement vis--vis monitoring of quality has

multi-pronged approach involving a combination of three agencies.

a. EPC agencies in the first instance, are themselves responsible to

set up a quality control lab conducts certain tests and keep this

record available for scrutiny.

b. Departmental Quality Control Agency

c. Third Party Quality Control Agencies a novel idea of engaging

reputed professional agencies who are independent to monitorthe quality execution of works. These agencies have been

selected at State level through a transparent open bidding

system, and they do not depend upon the payment of their bills

on the project authorities as they draw their payment at state

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level. The Government also decided to create posts of Chief

Engineer, Quality Control for different regions.

In addition to these agencies, quality is also checked up at

random by the Vigilance & Enforcement wing as well as, by the

Advisors to the Government and other senior technical officers. Many

prominent experts from IIT and other reputed institutions have also

been visiting these works.

(vii) Transparency: On line sharing of information has been put in

place to bring further transparency and encourage involvement of

public at large in the day-to-day progress of execution of works as well

as maintenance of quality standards. Special software has been

developed for project monitoring as well as quality monitoring and

they have been made available online to the general public through

web page through Centre for Good Governance (CGG), Hyderabad.

The feedback boxes were also kept at different public offices

throughout the State.

(viii) EPC Codes-A compendium of instructions on EPC was

developed and shared with all concerned to bring clarity. A separate

chapter on EPC was also annexed to the existing PWD codes following

due process.

(ix) Financial Management Projects had been prioritized for earlycompletion in consultation with the Finance Department. The

Department had also taken steps to complete 13 projects and ensure

utilization of partial benefits from another 23 projects. However, by

very nature of irrigation projects, benefits commensurate with financial

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expenditure can not always be achieved unless the entire project is

completed. The year wise budget and expenditure on Jalayagnam

projects is given in Table 3. It would be pertinent to point out that

budgetary releases were a major constraint on the overall expenditure.

As on 29th Febuary 2012, 13 major and medium irrigation projects

have been completed creating new IP of 1,37,254 acres and

stabilization of another 1,89,379 acres. In another 21 projects water

has been released to 14,37,995 ac of new IP and stabilization of

2,06,853 acres. By doing systemic improvements, an additional

ayacut of 1,18,374 ac has been achieved under four old projects.

Thus the total new IP created under major and medium irrigation

projects under Jalayagnam is 16.936 lakh ac and another 3.962 lakh

ac had been stabilized (Total 20.899 lakh ac).

Table 3: Annual Budget, Expenditure & Irrigation Potential

created under Major & Medium Irrigation Projects (2004-05 TO

2011-12)

S.NoFinancial

Year

Budget

(Rs. In Crs.)

Expenditure

(Rs. In Crs.)

Irrigation

Potential

(Lakh Acres)

1 2 3 4 5

1 2004-05 4,246.00 3,331.00 1.10 (New)

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Despite the financial constraints, efforts have been made to

prioritize the projects and complete them as per agreements and

the Action Plan for completion of various ongoing projects has been

prepared by the I & CAD Department. A large number of projects

are at advanced stage. Approximately half of these projects are

above 50% level. The action plan has been prepared in detail

taking into account the present physical progress of works,

clearances, land availability, other constraints etc. and with a

focused approach on those projects which can be completed.

Constraints

The projects taken up under Jalayagnam are not being completed

as per target in view of paucity of human resources (Table 4).

There are 5 posts of ENCs, 33 posts of CEs and 88 posts of SEs. In

view of various court cases, only in-charge arrangements are made

to these posts instead of regular promotions. In addition, frequent

change of incumbency of officers at different levels due totransfers / in-charge arrangements / retirements, there is no

continuity and the successors are unable to take timely follow up

action to sustain the tempo of works. As a result the progress is

hampered and the targets are not met with. It is, therefore,

suggested to collect the up to date project/package wise particulars

for appraisal and to take appropriate follow up action.

The need for continuation of third party quality control agency in

full scale/ with reduced staff/ termination as per agreement

conditions by entrusting balance work to the departmental quality

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control staff has to be reviewed as full time Chief Engineer Q.C with

his staff is in existence at present.

Table.4: Availability of Technical Officers in I &CAD Department

Sl.No

Posts 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12

1EE 447sanctioned posts

Vacancies

Nil 236 1 Nil 8 283 31 242 92

2

DEE1578sanctioned posts

vacancies

35 378 293 301 35 423 71 183 201

3

AEE

5846sanctioned posts

vacancies

1276 1374 2515 1693 502 1030 2673 1567 488*

* 1111+1300 (2411) Assistant Executive Engineer posts notified to

APPSC for Direct Recruitment.

All the activities of the Department are reviewed by various officials

from time to time and corrective actions are taken. In addition to

periodic high level reviews by Honble Chief Minister and

Minister (M&MI), all developments pertaining to Jalayagnam

projects are informed by the Department to the State Cabinet at an

interval of at least once in two months.

Most of the Jalayagnam projects were taken up in the drought prone

district of Andhra Pradesh which had witnessed continuous labour

migration, decline in agricultural activity, farmers indebtedness and

suicides. As a remedial measure to this decline Prime Ministers

rehabilitation package for these districts in the state of Karnataka,

Andhra Pradesh and Maharashtra was initiated. Irrigation project

became a major activity in these districts to assure water to the crops

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to check the decline in the farming activity in these districts. All the

medium Irrigation Projects in the drought prone district and some of

the major Irrigation Project like PCLIS. Dummugudem Tail pond were

therefore included in the Prime Minister relief package for these

districts. Therefore, the reason for simultaneously launching of the

projects must not be lost sight of while evaluating the various factors

like, preparation of DPR, time line for launching of the project finances

etc., If these reasons are kept in view, then many of the findings of

the audit can be explained, as to why Government of Andhra Pradesh

took up projects on a such a large scale in such as short time. The

nature of problem required urgent measures, which became the

genesis for taking up these projects.

The existence of farm land at a higher contour than the water levels in

the rivers, the position of Andhra Pradesh being a tail end state for

both Krishna & Godavari rivers directed the state Government to

explore for solution through available technology of lifts and big

motors and pumps. When technology and resources are available thennot directing them to bring relief to the farmers would have been

incorrect. We can produce power in a desert, but we cannot produce

water.

Therefore, the whole launching of Jalayagnam was directed by the

emerging situation in the drought prone district of Andhra Pradesh.

This requires to be kept in view while assessing the performance ofJalayagnam.

In nutshell, PAG is requested to consider the information given in this

document for finalizing the final performance report, duly considering

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the criteria, as given in the draft performance report. The performance

of the entity has to be Judged against a criteria through a

methodology mutually agreed between the audit and entity. In this

case, although audit has pointed out at many places shortcomings, at

no place, there is a conclusion arrived after judging against a criteria

i.e., a Government order, codes or even a model for undertaking such

projects.

In the absence of the performance being judged against a criteria, the

whole report appears as on exercise in piecemeal collecting evidence

and arrive at conclusions without stating, which codes, rule, order,

GFR has been violated or ignored while grounding projects. Therefore,

it would be correct to suggest that all the finding be subjected to the

criteria as already indicated, then we can arrive at final conclusion,

which would also be correct and then recommendation can be made to

improve the performance to attain the policy objectives of Jalayagnam.

Our replies for each finding is given. We would expect our replies to begiven equal printing space along with the findings while the final report

is being submitted to the legislature. The findings of audit and the

reply of entity should be given in equal measure and detail, even if the

audit does not agree with the replies given. Then only findings and

final conclusion will carry conviction and will be fair to the entity. With

these remarks on detailed reply is submitted.

Annexure-A

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As per the report of the C & AG of India of Government of

Andhra Pradesh, the details of the Performance Audit under gone

since last 6 years are as follows:

Sl.No.C & AGReport

Year endedGist of the paras Audit Para No.

1. 2004-05Performance Audit Not Conducted


3. 2006-07

Godavari Water Utilisation

Authority

(I) J.Chokka Rao Devadula LiftIrrigation Scheme (JCRDLIS)(II) Sripadasagar Project (SSP)(III) Alisagar Lift Irrigation Scheme(ALIS)(iv) Arugula Rajaram Gupta Lift

Irrigation Scheme (ARGLIS)

(V) Lendi Project and(vi) Dummugudem Project consistingof Rajeev Sagar and Indira Sagar LiftIrrigation Scheme.

3.2(Pg.Nos.56-71)


5. 2008-09 Third Party QualityControl/Assurance (TPQC) inexecution of Irrigation projects:AMRP, Pulichinthala, Telugu GangaProject, AVR HNSS, VeligondaProject, Komarambheem, Palemvagu,Kinnerasani, Thotapalli, Peddagadda,Tarakarama Theerthasagaram,

Jhanjavathi Project, SomasilaSwarnamukhi Link Canal, Pushkara,Venkatanagar LIS.

Accelerated Irrigation benefit

Programme:

In Andhra Pradesh, 30 Major/Medium

1.3(Pg.Nos.50-63)

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Irrign. Projs. and 67 MI Schemeswere identified under AIBP.1.SRSP Stage.I2.Annamayya proj3.Priyadarsini Jurala

4.Somasila Project5.Nagarjunasagar6.Madduvalasa7.Gundlavagu,8.Maddigedda,9.Kanpur Canal,10.Yerrakalava,11.Vamsadhara Ph.I,12.Flood Flow Canal of SRSP,13.SRSP-II

14.Tadipudi LIS,15.Pushkara LIS,16.Rallvagu,17.Gollavagu,18.Mathadivagu,19.Peddavagu,20.Gundlakamma Reservoir,21.Velligallu Reservoir,22.Alisagar LIS23.J.Chokarao LIS24.A.R.Guthpa LIS,

25.Nilwai26.Khomram Bhim27.Thotapalli barrage project.28.Tarakarama Thirtha SagaramProj.29.Swarnamukhi Medium IrrigationProject,30.Palemvagu and 67 Minor Irrigaaation Schemes.

6. 2009-10 Mahatma Gandhi( Kalwakurthy) Lift Irrigation Scheme

2.2( Pg.Nos.32-46 )

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23

3.Planning:

3.1 Selection of projects:

Andhra Pradesh is a predominantly Agrarian State

similar to many other large states in India. A Majority of the

population (More than 70%) depends and derives their

livelihoods and sustain on Agriculture and Agro based

activities. The growth of the State economy and majority

peoples well being therefore depends to a large extent on

the continuous growth and expansion of sustainable

Agriculture Sector.

The Single most important input for sustainable

Agriculture is water, which is primarily dependent on normal

or good monsoon rainfall. It is observed that in normal

rainfall years also, agriculture yields depend on timely

incidence of Rainfall both in terms of quantity & quality. The

effect of deficit rainfall is virtually crippling Agriculture

Sector to a large extent in the State. The Disastrous

consequences of continuous drought during 2000 to 2004

had broken the entire rural Agriculture based economy of

the State.

The districts affected due to droughts are as follows

DistrictTotal

Mandals

2000-01 2001-022002-

032003-04

2004-05

Srikakulam 38 16 38 28 11 8

Vizianagaram

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3.3.1 Feasibility studies:

Vamsadhara Stage-II Phase II

This project is a part of Vamsadhara Stage-I which is

cleared in all aspects. As the Government of Orissa is

objecting to the construction of Barrage from view point of

submersion, the project could not be taken up.

As such the phase-II component has been proposed

without head works but with side weir channel. In view of

that there is no difference in the status of availability of

water and ayacut to be benefited.

That is the reason why the project has been taken up

with the reports already prepared by the Department.

CBR Lingala Canal:

The Chitravathi Balancing Reservoir is an existing reservoir

to store 10 tmc Water. This balancing Reservoir is a part of

TBPHLC system and is intended to stabilize the ayacut of

59500 acres under Pulivendula Branch Canal and to serve

the Lingala Canal of 25000 acres. This scheme has been

proposed by suitably adjusting 10 tmc of water to the above

extents of canal system by adopting micro irrigation system

in the Pulivendula Branch Canal. Thus, the 10 tmc would be

available from the TBPHLC in the event of surplus years. So

the CBR right canal that is Lingala has been taken up within

the system made possible due to savings in the existing

Pulivendula Branch Canal. However, the CBR which is to

receive waters from the TBPHLC is not receiving adequate

quantity of water. In view of that the part of surplus water

that is being received into the Gandikota Reservoir System

is envisaged to be drawn to supplement the CBR system to

make the CBR system more effective from the view point of

the functionality by lifting waters from Gandikota Reservoir

System.

The integration of the operations of CBR system with

the Gandikota Reservoir is for improving efficiency of the


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3.3.3 Preparation of Detailed Project Reports

Sripada Yellampally Project

The preparation of DPR for this project was entrusted to M/s

Aarvee Associates before the award of the contract and

closely monitored, whereas the Agreement for the works of

SYP Stage-II Phase-I and NTPC Lift Scheme were concluded

on 03-04-2005 & 07-04-2005 respectively. The work of

preparation of DPR is mainly intended to get the project

clearances from CWC, which is a continuous process.

However in the mean time the works also are put on ground

to save delay.

Dr.B.R.A.P.C.S.S.

This project is taken up as per the Godavari Water

Disputes Tribunal (GWDT) report, dated 06th

October 1975, wherein the State of Maharashtra

and Andhra Pradesh have agreed in-principle to

take up this project at appropriate time with

agreed water utilization and with assured

availability of water. The Government of Andhra Pradesh has accorded

permission for preparation of detailed project

report for diverting 160 TMC of water from

Pranahita river to Sripada Sagar Project Reservoir

and creating additional Ayacut of about 12.20 lakh

acres including drinking water and industrial

requirement of Hyderabad vide G.O.Rt. No. 623, I& CAD Dept., dated 15-07-2005.

Accordingly, an Expert Technical Committee was

constituted by the Government of Andhra Pradesh

vide G.O.Ms No. 193, dated 27-10-2005 to

evaluate and finalize the bids and to take up the

work of preparation of Detailed Project Report.

The Government after careful examination of the

recommendations of the above committee decided


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3.3.4 Identification of targeted ayacut:

AMR SLBC Project:

The Government in 4/95 decided to take up Lift Scheme

from the foreshore of Nagarjuna Sagar Reservoir to give

early benefits without prejudice to Tunnel Scheme vide

G.O.Ms.No.55, I&CAD Department, dt.17.4.1995, as the

Tunnel Scheme would require 7 to 8 years to complete.

Accordingly, the Lift Scheme works were taken up and

completed. Partial benefits have been giving from 2001

onwards from Lift Scheme. Tunnel Scheme is taken up in

2005 as a permanent solution. Since the possibility of

drawing water by gravity is available for this project, the

Tunnel scheme is taken up. For most of other schemes,

there is no alternative except taking up of Lift.

SOMASILA SWARNAMUKHI LINK CANAL (S.S.L.C.)

The details of the Village wise and Mandal wise identified

targeted Ayacut pertaining to SSLC Scheme have already

been furnished to the audit. However a copy of the same is

enclosed herewith.

VELIGONDA PROJECT

In the project scope of all works pertaining to canal

networks, Mandal wise ayacut was prescribed. This is for

the reason that in the absence of detailed ayacut registers

the Village wise ayacut cant be arrived at. In fact the

preparation of ayacut registers is one of the tasks in the

EPC agreement which can be arrived at only after

finalization of HPs, BC Maps etc. So far, the village wise

ayacut finalized package wise is as follows.

Package II- 41,000 Acres

Package III- 9,500Acres

Package IV- 19,500 Acres

Package VI- 2,50,000Acres

TOTAL 3,20,000Acres


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3.4.1 Indira Sagar Dummugudem LIS

The APTRANSCO has requested the department to deposit

Rs.290.14 Crores towards the estimated cost of the

transmission scheme for ISDLIS for providing 229.096 MW.

The Chief Engineer during 09/2009 has addressed the

Government for according permission to deposit the

amount with APTRANSCO. In turn, the Government have

communicated certain remarks, which were attended by

the department during 01/2010 duly obtaining the data

from the APTRANSCO. Later the Government have

instructed to ascertain from APTRANSCO during 10/2010

details of Phases in which the amount of Rs.290.14 Crores

can be deposited with amount of each installment.

Accordingly a report was submitted to the Government by

the Chief Engineer during 11/2010. The Government vide

G.O.Ms No.59, dt: 19-09-2011 have accorded permission

to deposit the amount in 4 installments. Accordingly an

amount of Rs.136.32 Crores was deposited during 02/2012

for taking up the works of transmission scheme. There is

no time lag in completion of the scheme from the govt. or

department side.

Hence, the para may be dropped.


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3.4.2 Rajiv Dummugudem

RDLIS: RDLIS: AP Transco agreed to provide

220 KV and 132 KV transmission line and requested the

I&CAD department to deposit an amount of Rs.175.35

Crores, The Chief Engineer has requested the Government

during 08/2010 to accord permission to deposit the

amount. Replies to remarks of the Government were

submitted during 03/2012 and permission is awaited.

There is no time lag in completion of the scheme from the

Government or department side.


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4.3 JPDNSS:

DNSS: The WAPCos estimated and submitted power

quirement in the DPR as 1565.4 MW for 6 pump houses

JPDNSS. The actual power requirement calculated by I

CAD Department for 6 pump houses is 1135.87 MW, for

ich estimate is prepared and approved by the IBM

mmittee. Information regarding number of pumps to be

erated and month wise requirement will be submitted

er approval of design of pumps and motors.

nce, the para may be dropped.4.4 AVR Handri Niva Sujala Sravanti :

NSS Project proposes to provide Irrigation facility to 6,

,500 Ac in the four districts of Rayalaseema and

nking water to about 33 Lakh people living in urban

eas like Dhone, Pattikonda, Guntakal, Kalyanadurg,

yadurg, Dharmavaram, Puttaparthi, Kadiri,

enukonda, Madakasira, Hindupur, Rayachoti,

danapalli, Thambaplli, Vayalpad, Pileru, Palamaner,

nganur, Pakala, Chittoor etc., and the rural areas

route the canal using about 40 TMC of the flood waters

the Krishna River. The Project is a lift Irrigation scheme

awing the flood waters of the Krishna from the

sailam Reservoir during the monsoon period. The flood

ters of Krishna are proposed to be drawn from a point

ar confluence of the Krishna and Tungabhadra Rivers in

e fore-shore of the Srisailam Reservoir without affecting

e other committed uses under Srisailam and below

luding Nagarjuna Sagar and Krishna delta. water from

e Reservoir will be drawn when the Reservoir level is

66.67m and above, through an approach channel and

ad regulator near Malyala village in Kurnool District and

ed to EL +290.00m from there, the water will be

nveyed through a system of gravity canals cum lifts.


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4.3.6 Adequacy of time for bidding:

Adequate time has been provided to the Bidders for carrying out

the preliminary survey and investigation before tendering

depending upon the nature of work involved in the

Project/package. Hence this is not a deviation from FIDIC model

of EPC system and the contention of the audit that sufficient

time is not provided to the Contractors towards preliminary

survey and investigation before tendering is not correct.

Indira Sagar Dummugudem Lift Irrigation scheme : The

works of Indira Sagar Lift Irrigation scheme, except Pump

houses were divided in to 3 packages and Tenders were called

for in Tender No.2/2006-07, Dated.17.07.2006, in Cat.-I. Due

to Technical problems Tenders of these packages were cancelled

and were invited again vide Tender No.4/2006-

07,Dated.27.10.2006.

Financial Bids for Tender No.4/2006-07 were opened on

dt.16.11.2006 and Bids received for package Nos.21 & 22 and

there is no response for package No.23.

The tender for package No.23 was again called in tender

No.5/2006-07,Dated.18.11.2006. But, no response even for

second call.

Based on the instruction of the CE/GLIS, Warangal, the

package No.23 is divided into small packages one package in

Cat-I (package No.31) and three packages in Cat.-II (package

Nos.49,50 &51) vide CE/GLIS, Warangal

Lr.No.CE/GLIS/WGL/DCE/DEE/Camp-2, Dated.02.01.2007 as

smaller packages may have response.

Tenders were called for package Nos.31, 49, 50 & 51, in tender

No. 6/2006-07,dated.06.01.2007 for package No.31 and tender

No. 7/2006-07,dated.06.01.2007 for package Nos.49, 50 & 51.

For the response of above tenders, single bids were received for

31,50 & 51 and awarded

Hence, the para may be dropped


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4.3.9 Payment schedules:

In EPC System, payments are made to contractor as

per Payment Schedule. The total work specified under EPC

turn-key contract is divided into several components of

work to facilitate payments component wise. The

contractors bid price as approved shall be divided among

the components of work as per respective percentage of

total bid price. The payment for each of the componentworks shall be limited to the respective amounts arrived

on the basis of percentages specified.

Payment schedule can be revised (based on

detailed investigation, drawings and detailed estimation)

due to variance in estimate. For revision of payment

schedule, Chief Engineer is empowered for changes from

component to component and Superintending Engineer

from sub-component to sub-component within the

component duly keeping the total price bid value

unaltered.

Further from each bill, 7.50% of bill amount will be

retained by Department until completion of whole work

and on termination of contract in midway due to

Contractors fault, all property at Site becomes

Department property and any amount due to the

Department will be treated as debt and will be recovered

from agency with interest as per Agreement Clause.

Hence the contractor may not leave the work midway

because of revision of payment schedule at initial phases

as pointed out by Audit and no loss will be caused to the

public exchequer.

Contractors are also allowed to revise Payment

Schedules several times to their advantage

resulting in front end payments. Such upward

revision of costs for items executable in the initial

phases would result in loss to public exchequer if

the contracting agency stops the work midway.

RDLIS:

As per para 306(T) of AP Public works account code, the


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Response-Audit Report on Jalayagnam-Vol.1