CAG Report: NOIDA assigned farmhouses in 'questionable' manner, caused massive loss to exchequer

A new CAG report has said that farmhouse schemes launched in Noida during 2008-11 lacked requisite Uttar Pradesh government approvals, and allotments under them were done in a "questionable" manner, causing a loss of over Rs 2,833 crore to the exchequer. 

On Friday, the audit report was tabled in the Uttar Pradesh Assembly. The Comptroller and Auditor General (CAG) also flagged significant lapses in policies adopted by the New Okhla Industrial Development Authority (NOIDA), also called the Noida Authority.

The report highlighted lapses in general policies, planning, acquisition of land, allotment of properties, and internal control in NOIDA which it said resulted in the loss of crores to the exchequer.

Asked about the CAG's audit, the NOIDA Authority said it was yet to study the report, which runs around 500 pages and covers years after 2005.

"Gaps in allotment which had been highlighted in the past are being streamlined now. There have been certain areas of concern pointed in the draft report, some of which were agreed to by us while to some others NOIDA had presented counter facts also. The final report is yet to be studied," NOIDA CEO Ritu Maheshwari told PTI.

"The detailed report is yet to be studied by us and we will take action as per the government's directions to us," the senior IAS officer added.

On allotment of farmhouse plots, the CAG noted that two schemes were launched during 2008-11 for plot allotment under which an 18.37 lakh sqm area was allotted to 157 applicants.

"Audit noted that the farmhouse schemes were launched without prior requisite clearances and due diligence. The scheme of NOIDA was ab initio in contravention of the regional plan which permitted the establishment of farmhouses outside abadi (inhabited) area," the report read.

"The farmhouse category was introduced without GOUP (government of UP) approvals relating to Building Regulations," added the report.

The CAG also flagged the "low and questionable fixation of reserve price" in the farmhouse schemes.

"NOIDA acquired agricultural land from farmers and made allotment of farmhouses in close proximity to well-developed areas with corporate offices having infrastructure that commanded a substantial premium in the real estate market," it noted.

A joint physical verification of Sectors 126 and 127 was conducted by the audit team and management of NOIDA on December 6, 2019, to see the present status of development in the sectors.

The CAG further flagged the "blatant violations" in allotment of farmhouse plots and noted that in the allotment of plots, it was observed that the Plot Allotment Committee (PAC) did not have any "objective and transparent criteria" for interview and assessment of the applications received.

"Allotments made on the recommendation of PAC reveal a blatant disregard for scheme guidelines and a willful role in concealment and misrepresentation of material facts, whereby ineligible allottees were made allotment of farmhouses," the report stated.

"Thus, the entire process of allotment of farmhouse plots, in the view of Audit, was a blatant exercise of allotting prime land to individuals for leisure use rather than in public interest," it noted.

The CAG stated that "suppression" of multiple reports, repeatedly pointing out "discrepancies" in the allotment procedure indicates that NOIDA has intended to regularise the allotment and shield the conniving officials rather than to take action against those who abused their fiduciary position to undertake and abet such irregularities.