Post-Rs 116 crore scam, special audit of Smart city fund recommended

Mayor Joshi stated that regarding the scam where the civic body’s funds have been embezzled, everyone is on the same page across party lines. He then presented a detailed paper on the same after seeking details from the officers.
“On the basis of the details, the Director General of Audit (Central), UT, Chandigarh, has been requested to conduct a special audit of Chandigarh Smart City Limited (CSCL) before and after its closure so that financial irregularities and loss to the Government /Municipal Corporation, Chandigarh may be established,” the civic body presented to its councilors.

As the Congress councillors protested in the House over the entire scam, the mayor stated that all of them had similar sentiments over the issue.

The sequence of details was presented in the House as to how after the scam came to light in Haryana, the MC officials approached

IDFC First Bank, Sector 32, Chandigarh, requesting encashment of FDRs as per office records of bank statement of April 22, 2025.

It also said that bank statement copies be provided for scrutiny and examination and transfer of the entire balance (including updated interest) lying in account no. 99988877765 to MCC’s PNB account no. 00382010033490.

However, on scrutiny of records provided by IDFC First Bank, it was found that the FD amounting to Rs 116.84 cror, which were shown as active assets in the handed-over records, do not exist in the bank statement obtained from the IDFC Bank on February 24, 2026, it said.

The House was informed how scrutiny of the bank statement received on February 24, 2026, revealed that three

payment entries, dated April 11, 2025 (two entries of CAPCO FINTECH) and September 1, 2025 (one entry of SUNLIVE SOLAR SYSTEM) amounting to Rs 78.22 crore had no corresponding reflection in the records of MCC regarding payments made to the agencies concerned, and, therefore, it appeared suspicious and required detailed investigation.

Then on February 25, 2026, the regional head and cluster head of IDFC First Bank informed that bank statement, dated April 22, 2025, and FDRs amounting to Rs 116 crore appear to be fake and fraudulent.

“Due to prompt action by the office in the IDFC First, Branch Sector-32, Chandigarh, the IDFC First Bank has remitted Rs 1,21,14,82,833.37 to the MCC PNBAccount No. 00382010033490 on 25.02.2026. However, the MCC has categorically clarified to the IDFC First Bank that above amount is subject to reconciliation and audit, may not be treated as full and final claim of MCC and further MCC reserves its rights and remedies to recover the amounts/dues, if any. Following this, SSP, UT, Chandigarh vide this office letter no. MCC/2026/311, dated 05.03.2026 was requested for registration of FIR and detailed investigation in the matter,” it was specified.
It was also particularly mentioned that involvement of bank officials and officials of Chandigarh Smart City Limited cannot be ruled out in this case.

The House was informed that the Municipal Corporation terminated the services of accountant on outsource basis and already placed delinquent officials concerned, that is accountant, superintendent under suspension and the disciplinary action has also been proposed against the section officer of the Finance Department, UT Chandigarh. These officials were responsible for record handing over and taking over at the time of closure of CSCL.
A case on March 9 this year under sections 318(4), 338, 336 (3),

340(2), 61(2), 316(5)BNS, P.S EOPS, Sector-17, Chandigarh had been registered and investigating officer had also taken documents on March 17 from the civic body. Electronic devices and gadgets were also seized on April 4 from the cabin of Anubhav Mishra, ex-accountant into the police possession through the respective seizure memos.
A departmental committee constituted under the chairmanship of Joint Commissioner, MC, has also submitted 13-page committee report (March 13, 2026) which has also been handed over to investigating officer, EOPS for further investigation in the matter.