Bhubaneswar: Officials of the Rural Development Department allegedly made irregular payments to contractors without verifying mandatory bitumen purchase receipts, causing a loss of Rs 84.42 crore to the state exchequer, a Comptroller and Auditor General (CAG) report has revealed.
Government guidelines require contractors to submit receipts proving the purchase of bitumen and emulsion from authorised manufacturers for road projects. However, the audit found that officials failed to properly verify the documents.
The report, tabled in the Assembly during the ongoing Monsoon Session, examined 107 road projects with a combined contract value of Rs 352.73 crore across six divisions.
Of these, Rs 43.87 crore was allegedly paid irregularly to contractors without verifying receipts for bitumen purchased from authorised manufacturers.
The report also found that contractors executing works in seven districts failed to complete projects within the stipulated deadlines.
Despite this, officials did not recover Rs 40.55 crore from them as required under the contract terms.
The two lapses together resulted in an undue benefit of Rs 84.42 crore to contractors, the CAG said.
The 107 road projects audited involved the use of 8,285.12 metric tonnes of bitumen.
In October 2019, the Finance Department had directed all departments to accept only receipts showing that bitumen and emulsion had been purchased from principal manufacturers while making payments to contractors.
The Rural Development department later issued similar instructions, directing its agencies to procure bitumen and emulsion only from designated principal manufacturers, including IOCL, HPCL and ED CL/OSIC.
However, an audit of the 107 road projects found that contractors had not submitted receipts proving purchases from these authorised suppliers.
Despite the directives, executive engineers failed to verify the receipts before making payments.
As a result, officials paid Rs 43.87 crore to contractors without confirming that the materials had been procured from designated manufacturers, the CAG said.
The lapse also raised concerns over the quality and durability of the road works, the report said.
In another lapse, Rs 16.63 crore was rendered unproductive due to the failure to carry out repairs on three roads identified during inspections between February 2022 and February 2024.
Despite the inspections, no repair work was undertaken, and the concerned executive engineers failed to submit action-taken reports by March 2025, the CAG said.
In Nayagada, Ganjam, Nabarangpur, Puri, Mayurbhanj, Sundargada and Anugola districts, contractors failed to complete road works within the stipulated time, leaving 2,428 villages without all-weather road connectivity, the report said.
Despite the delays, departmental officials did not recover Rs 40.55 crore from the contractors as required under the contract terms, causing a loss to the state exchequer, the CAG said.
