UP discoms violated rules in purchase of transformers: CAG report - Hindustan Times

2022-09-24 01:44:03 By : Ms. Monica J

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LUCKNOW Power companies of Uttar Pradesh violated rules in the purchase of transformers with officers arbitrarily giving contracts to ineligible firms for the supply of transformers worth crores. Ignoring the requirement of registration with the Bureau of Indian Standards (BIS), contracts were given to firms that only submitted applications without following norms, pointed out the report of the Comptroller and Auditor General of India (CAG) placed in both houses of the legislature on Wednesday.

The report also recommended action against the officers responsible for the purchase of sub-standard transformers.

The CAG report reviewed the procurement of transformers by Madhyanchal, Purvanchal, Dakshinanchal and Pashchimanchal Vidyut Vitaran Nigam from 2016-17 to 2018-19. During this period, the discoms submitted 146 tenders for the purchase of 3,01,336 distribution transformers worth ₹ 2,489.71 crore.

The power companies also finalised tenders for repairs worth ₹ 290.23 crore. The CAG reviewed 33% tenders for the purchase of 1,67,379 transformers and 45% tenders for repairs worth ₹ 147.73 crore. The contracts were awarded in an arbitrary manner, stated the report.

In some cases, it also came to fore that tenders were opened first and BIS certificate was given later. Due to failure to implement the price fallback clause, power companies had to incur an additional expenditure of ₹ 1.37 crore.

According to the report, necessary quality testing of 1,26,205 transformers worth ₹ 802.92 crore was not done. The audit also revealed that undue advantage was extended to a firm based in Meerut in the purchase of transformers despite the sample failing the quality test. According to the report, many firms were not fulfilling the pre-qualification conditions and they fell well short of the prescribed standards.


The CAG report accused Dakshinanchal Vidyut Vitaran Nigam of giving undue favour to Torrent Power Ltd handling electricity supply in Agra. The report stated that the discom recovered ₹ 79.90 crore lesser regulatory surcharge from Torrent Power Ltd due to which the company suffered ₹ 29.77 crore loss of interest. The CAG also put the discom in the dock for the purchase of sheet moulding compounding (SMC) boxes in excess of the requirement, saying that unreasonable purchases of ₹ 7.86 crore were made.

The CAG report also revealed that the Madhyanchal Vidyut Vitaran Nigam (MVVNL) made unreasonable purchases of transformer protection boxes worth ₹ 7.25 crore, which remained unutilised for more than four years.

However, UPPCL officials were not ready to speak over the CAG report. A highly placed official said there was always scope for improvement in the system, and if directed, action would be taken as per the recommendations of the report.

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