11.8 C
Munich
Sunday, October 2, 2022

State coffers robbed of Tk 4,697cr by Petrobangla, BPC

Must read

The government has been deprived of about Tk 4,697 crore for 19 counts of irregularities by Petrobangla and Bangladesh Petroleum Corporation, found an audit.

The disclosure comes after the Comptroller and Auditor General (CAG) pored over the books of 11 companies under Petrobangla from fiscal 2014-15 to 2016-17 and two companies of BPC for fiscal 2013-14. The findings were presented in parliament in June.

The irregularities include spending beyond the rules to buy goods and services at high prices; flouting the instructions of the finance ministry and the National Board of Revenue; and disregarding the Gas Sales Rules 2004 and 2014, the Bangladesh Gas Act 2010, Bangladesh Energy Regulatory Commission, the Public Procurement Act 2006 and the Public Procurement Rules 2008.

Of the Tk 4,697 crore that was lost, Petrobangla’s failure to deposit in full the value-added tax and supplementary duties, collected from the gas distribution companies, to the exchequer alone accounts for Tk 4,597.3 crore, the CAG found.

In fiscal 2016-17, Petrobangla collected VAT and SD of Tk 6,015.5 crore, which it was supposed to deposit to the exchequer.

But it deposited Tk 2,080.3 crore, keeping the rest in its accounts. There has been a 2 percent interest on the outstanding sum, which comes to Tk 334.8 crore.

So the state coffer has Tk 4,270 crore outstanding from Petrobangla, the report said.

Furthermore, in fiscal 2015-16, Jalalabad Gas Fields, Sylhet, and Bibiyana Gas Field, Habiganj, collected Tk 327.4 crore from the gas distribution companies in VAT and SD. The sums were not deposited to the state coffer.

When probed on the matter by the CAG audit team, Petrobangla said the unpaid amount was used to cover the deficit that arose from the mismatch between its purchase and selling price of gas.

But in practice, the CAG found a separate fund created in March 2017 called “Support for Shortfall Margin” for this end.

Petrobangla acknowledged the anomaly pointed out by the CAG audit team and admitted that the VAT and SD were not duly forwarded to the state coffer.

There has been no action, the report added.

There has been a financial loss of Tk 14.3 crore in fiscal 2016-17 alone for not including the wheeling charge in the contract signed with the multinational oil and gas exploration company Tullow for gas purchased, the CAG found. The wheeling charge is the fee paid for the use of transmission lines to transport gas.

As per the laws of the land, Petrobangla deducts 4 percent from the payment to gas producers as wheeling charge.

But in the agreement signed with Tullow on June 6, 2018, there was no clause on the collection of wheeling charge for using Bangladesh’s transmission system and territory for delivering its product.

When the CAG audit team enquired about the anomaly, no response was received, according to the report.

Another Tk 22.9 crore was lost for payment of distribution charge to Titas Gas that included the system loss occurred during the import of gas from international oil companies.

A certain portion of the gas is lost in transit during the import to Bangladesh. But there is no such loss when the imported gas is distributed to the end users.

But Titas Gas claims otherwise and has been charging for the system loss that occurs during its distribution.

The CAG audit team sought an explanation for the irregularity but no response was received.

Titas Gas also has a deficit of Tk 26.4 crore for non-adjustment of Everest Power Generation Company’s bills.

Although Everest Power the BERC obtained licence to operate as a commercial independent power producer (CIPP) on June 21, 2016, it did not sign a deal with Rural Electrification Board for another five months.

Its gas sales agreement with Titas was signed on January 4, 2017, meaning it was not entitled to the tariff for CIPP until this.

Its tariff was for small power producers but it paid the gas bill as a CIPP. Subsequently, Everest has Tk 26.4 crore outstanding.

The CAG audit team called for collection of the sum at the earliest.

In fiscal 2016-17, the Bangladesh Petroleum Exploration and Production Company (BAPEX) paid Tk 8.3 crore to its officers and employees in special bonuses and honorarium, which went against the instructions of the finance ministry.

The one-off pay was supposed to be performance-based as per the finance ministry’s orders but BAPEX gave the bonus on a wholesale basis.

Subsequently, the CAG called for collecting the impugned amount from the officers/employees and depositing the sum in the company fund.

The state-owned petroleum exploration and production company also reimbursed the electricity and water bills of its employees, which came to Tk 1.9 crore.

As per their pay scale, the employees are not entitled to such benefits. Permission from the finance ministry is needed for such payments, which was not taken, according to the report.

When asked about the indiscretion, BAPEX said that its employees are underpaid in comparison to the foreign companies, so the management thought of reimbursing the utility bills as an add-on to their remuneration.

The CAG did not accept this rationale as it goes against the decision of the standing committee on the ministry of power, energy and mineral resources.

Subsequently, it asked BAPEX to collect the sum from its employees and officers and deposit it in the state coffers.

Karnaphuli Gas Distribution Company, a Petrobangla-owned company, was deprived of Tk 2.4 crore in fiscal 2015-16 and 2016-17 for not disconnecting the gas line of a customer — Sitalpur Steel Mills — despite finding evidence of tampering with the meter reading four times.

As per the Gas Sales Rules 2004 and 2014 and the Bangladesh Gas Act 2010, the connection should have been snapped when tampering was caught for the third time and the dues collected at the earliest.

When prodded on its non-action, Karnaphuli Gas pinned it on the pending legal case.

The answer was not accepted by the CAG audit team, which called for action against the employees concerned.

The company also has dues of Tk 1.89 crore from SA Oil Refinery, a concern of SA Group.

The refinery consumed more gas than its contracted volume from April 2009 to June 2017. But Karnaphuli Gas has not collected the dues due to the SA Oil Refinery’s financial hardship.

Subsequently, the CAG called for the recovery of the outstanding sum and action against the officials responsible for the lapse in collection.

Jalalabad Gas suffered a financial loss of Tk 1.91 crore for collection of gas bills from Lafarge Surma Cement at a lower rate than the government fixed rate, found the CAG audit team.

The state coffers were deprived of Tk 6.83 crore due to Bangladesh Gas Fields Company’s failure to deduct the income tax from the contractor’s bill for the supply of mining materials and all mining-related services.

Another Tk 3.38 crore was lost for Pashchimanchal Gas Company Ltd’s failure to collect dues from Bablu CNG and Refuelling Station in Bogura, which had set up an illegal line after its connection was severed by a mobile court.

PGCL is supposed to take legal action to collect the dues. No case was filed, the report said, while calling for actions to retrieve the sum.

- Advertisement -spot_img

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

- Advertisement -spot_img

Latest article