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Vigilance probe red-flags fraud and corruption in Arunachal hydro project

MoS Kiren Rijiju writes letter to clear payments blocked after probe, his cousin is sub-contractor in project.

Written by Deeptiman Tiwary | New Delhi |
Updated: December 13, 2016 4:34:49 pm
kiren rijiju, kiren rijiju scam, kiren rijiju arunachal scam, Arunachal hydro project, arunachal pradesh, arunachal pradesh fraud, arunachal pradesh corruption, kiren rijiju, goboi rijiju, NEEPCO, power fraud, electricity fraud, dam construction, dam construction corruption, indian express news, india news Minister of State for Home Affairs Kiren Rijiju. (File Photo)

Union Minister of State for Home Kiren Rijiju; his cousin, a contractor in Arunachal Pradesh, Goboi Rijiju; and several top officials of North Eastern Electric Power Corporation (NEEPCO), including its Chairman and Managing Director, have been named in a 129-page report by the PSU’s Chief Vigilance Officer that alleges corruption in the construction of two dams for 600 MW Kameng Hydro Electric Project, one of the biggest hydro-electric projects in Arunachal Pradesh.

The report by CVO Satish Verma, sent to the CBI, CVC and the Ministry of Power in July this year, alleges an “elaborate conspiracy” involving contractors, NEEPCO officials and the West Kameng district administration to defraud NEEPCO and the government of funds that “may extend up to Rs 450 crore.” West Kameng, the site of the project, falls in Arunachal West, the Minister’s parliamentary constituency.

WATCH| Rijiju Rubbishes Involvement In MW Kameng Hydro Electric Project Scam

The CBI has made two “surprise checks” but no FIR has been registered yet.

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Verma, a Gujarat IPS officer, was pulled up by NEEPCO for “unauthorised absence,” and transferred to the CRPF in Tripura soon after his report. He attributes the “absence” to his investigation.

Two dams and a project

At the heart of the conspiracy, Verma’s report says, are several fake and inflated bills by contractors to allegedly siphon off money in the name of transporting rocks needed for the dam construction. Not only was the transportation cost decided arbitrarily, the report says, but many transport challans and records provided by the contractor, Patel Engineering Limited (PEL), were found to be fake. For example, thousands of tonnes of rocks were found to have been carried to the project site, at least on paper, on scooters, bikes and cars even as several registration numbers provided by PEL were found to be non-existent, the report says. In some cases, the same vehicle number or the same driver appeared many times on different challans claiming to have begun the journey from different quarries situated 70 km away on the same date just half an hour apart.

Reimbursement of these bills, which primarily belonged to the period between May and July 2015, to PEL was stopped by NEEPCO after Verma sent an advisory to the Head of Project flagging the alleged irregularities.

Records with The Indian Express show that on November 4, 2015, MoS Kiren Rijiju wrote a letter to Ministry of Power to release funds to the contractor and his cousin Goboi Rijiju went to meet Verma. Goboi Rijiju is one of the sub-contractors in the project. Verma’s report also has the audio CD of a purported conversation he had with Goboi Rijiju on December 29, 2015, in which the latter is heard pushing the officer to clear the payments and offering “any help you need from Bhaiya (the Minister).”

NEEPCO later did allow partial payment to PEL of the pending bills of June and July with concurrence from Verma and work began on the dam in March, 2016. Since the work had stalled since September 2015, on request from CMD NEEPCO, Verma agreed to an arrangement where 60 per cent of pending payment could be released in case of one of the dams and 75 per cent in another dam and powerhouse. The figures were arrived at on the basis of the percentage of bills that had a (fake or genuine) vehicle number. CVO recommended that legal action should nevertheless be taken after a full-fledged investigation.

The NEEPCO project, which is nearing completion, includes two dams over the Bichom and Tenga rivers. Work on Kameng Hydro Electric Project started in 2005 after the tender for civil work at Bichom Dam, Tenga Dam, and a powerhouse at Kimi were all bagged by Mumbai-based Patel Engineering Ltd (PEL).

For raw material such as rocks and boulders, quarry sites — close to the two dam sites and the powerhouse — were identified at the stage of tender itself and the contractor, with help from NEEPCO, was supposed to obtain the necessary permit/license, the report says. The quarries were within a 3-km radius of the project site. In 2011, however, the Government of Arunachal Pradesh objected to quarrying at the initially identified locations and thus new locations (some of them as far as 70-80 km) were identified. Fresh tenders were thus floated for transportation of boulders from these sites and PEL bagged it after a court battle.

Until then, according to the report, “very little concreting work was done” at the project site with just “8000 cubic metres” of rocks and boulders being used. It was only from December 2012, that work at Bichom and Tenga dams picked up pace and thousands of tonnes of rocks were brought to the site ostensibly from three quarries located at Hupori (15 km), Jameri (70 km) and Palizi (85 km).

Fake bills, ad hoc rates

Consider the key allegations in Verma’s report:

# PEL began to claim cost of extra carriage (called “extra lead” technically) saying that boulders had to be brought from quarries much farther than the ones initially agreed upon. NEEPCO, according to the report, fixed the rate at Rs 75.95 per km per cubic meter (for transport 1 cubic meter of rocks across 1 km). It was also decided that until the contractor furnishes documentary proof of the extra carriage, it would be paid 80 per cent of the agreed amount at Rs 60.75 per km per cubic meter.

# Head of Project, Giridhar Patowary, opposed this but was over-ruled by CMD P C Pankaj and his senior colleagues.

# PEL got more material from quarries located close to the project site but claimed that most of their material was from quarries located farthest. On July 17, 2015, surprise checks were made by the CVO and the Superintendent of Police Kameng district. Neither the quarry sites nor the Bichom dam site maintained any records (of boulder stockpiles and transportation details). Records (of May-June 2015) found at Tenga Dam site, upon verification, were found to be fraudulent.

# Project officials had no system to verify transport claims made by PEL and yet passed the bills for “hundreds of crores of rupees.”

# For transport bills for June and July 2015 related to Bichom Dam, of the 4708 transportation challan copies submitted, only 2860 had vehicle numbers. Many transportation challans from December 2013 to May 2015 had “applied for” written in place of registration number of vehicles.

# Verification of vehicle numbers purportedly deployed in May-July 2015 revealed that “significant numbers” were found to be fake, and those vehicle numbers belonged to other kinds of vehicles like cars, two-wheelers, and some were not registered at all.

Minister writes a letter, brother makes a call

After a preliminary probe found these alleged irregularities and an advisory was sent to project head by CVO, in July 2015, payment to PEL was stopped for the boulders brought during June and July 2015. Since PEL did not pay local contractors — one of whom was Goboi Rijiju — on this ground, work at the Bichom Dam site was stopped in September.

On November 4, 2015, Kiren Rijiju wrote a letter to Piyush Goyal, Minister of State (Independent Charge) of the Ministries of Power, Coal and New and Renewable Energy. The letter made a reference to a petition from local people made to Rijiju on September 29 where it was alleged that the payment to PEL and, in effect, local contractors had been stopped at the behest of NEEPCO CVO Satish Verma and that Rijiju must intervene to provide relief.

“Their plea (people of West Kameng district) is to release pending payment of boulder transportation for Kameng Hydro Electric Project, which is being undertaken by North Eastern Power Corporation Ltd (NEEPCO)… The grievance of locals is that initially they were getting their dues but after a while payments have been stopped, perhaps on behest of CVO, NEEPCO. I would be grateful if you could kindly get this petition considered in your Ministry sympathetically on priority,” Rijiju wrote in his letter.

Following this on December 29, Goboi Rijiju, Kiren Rijiju’s cousin visited CVO Verma and requested for payments to be released to PEL.

Goboi Rijiju purportedly says that his elder brother Kiren Rijiju is under pressure from local people because of non-payment of dues and stoppage of work at the dam site. He claims that local people not engaged in transportation work have to be paid. When Verma points out they should not be paid as they are not transporting the boulders, Goboi says, “There is no employment there for people. So people approach Bhaiya (the Minister) and ask him to hand over work to PEL. Earlier Patel used to do the work itself. Then three tribes went and met bhaiya to put pressure on Patel to get them work.”

When Verma insists that payments to PEL can only be made after it furnishes records and raises correct bills, Goboi says he would try to organise that and offers help in Verma’s promotion through his brother. “Hum suna aapka promotion ho raha hai… To aap mere bhaiya ke layak kuch hone se aap boliye sir. Kuch bhi sir, aap humko boliye. Bhaiya ka koi bhi help chahiye sir. (I heard you are getting promoted. If there is anything bhaiya can do you tell me sir. Any help you need from bhaiya,” Goboi says.

If it’s a scam, it must be probed: Kiren Rijiju

Asked about his letter and his cousin approaching the CVO the minister told The Indian Express: I did write a letter to Ministry of Power to release funds to Patel Engineering (the contractor). But it was on the basis of a petition I had received from local contractors of the area. I had no idea it involved a scam. If it is a scam, it must be probed and those responsible must be punished. I am totally against corruption.

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