nitesh
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http://www.expressbuzz.com/edition/...3s=&SEO=&SectionName=zkvyRoWGpmWSxZV2TGM5XQ==
ISRO arm plays favourites
Express News Service
First Published : 02 Jan 2009 08:18:00 AM IST
Last Updated :
BANGALORE: A performance audit of the Antrix Corporation Limited (ACL), the commercial arm of Indian Space Research Organisation (ISRO), has revealed many irregularities in the functioning of the company, including undue benefits to private companies.
The Express has a copy of the report of the Comptroller & Auditor General of India on the performance of Antrix Corporation Limited, which was tabled in the Lok Sabha in October.
The report highlights the following points: n ACL extended undue benefit to Space TV (Tata Sky) by reducing the rates originally accepted by the customer while entering into a longterm agreement. Due to a reduction in lease charge, there was a recurring loss of revenue of Rs 4.8 crore per annum, whereas revenue of another Rs 5 crore was foregone due to increase in free period by a month.
n The company allowed Reliance Communications Limited to bill for the bandwidth utilised by them instead of the bandwidth allocated to them.
Absence of a deemed supply clause in 16 contracts led to a loss of Rs 27.45 crore in revenue.
n The service charge on foreign transponders was voluntarily reduced by the company, resulting in a recurring loss of Rs 8.3 crore in seven cases. There were delays in recovery of quarterly recurring charges and service.
n Service Tax was not being collected from foreign hired transponders resulting in a likely liability of Rs 16.77 crore to the exchequer. However, service tax was collected from INSAT operations.
n Though the company was set up as the commercial arm of the Department of Space (DOS), several commercial contracts like with Prasar Bharati, New Sky Satellite, Netherlands and INTELSAT were not entrusted to the company.
n ACLs non-operational revenue (interest earned from deposits in banks) averaged around 50 per cent of the profit after tax during 2002-03 to 2006-07, which suggests that the company was used as a special purpose vehicle for unutilised funds by the DOS.
n Despite having substantial cash balances, ACL had not developed proper procedures to increase its yield from the surplus cash retained by it.
n There were delays in revenue recognition or raising bills and important contractual provisions in respect of performance bank guarantee, surrender or termination of leased capacity were not followed.
n Company-specific guidelines and procedures for investments, personnel and accounts had not been developed even 15 years after the companys creation in 1992 and despite Governments clear directive.
n The functional distinction between the company and the DOS was ambiguous since the departments officers were also executives of the company. Proper delegation of powers consistent with good governance, structure and growth of the company had not been drawn.
n ACL credited the DOS share of revenue to ISRO instead of the Consolidated Fund of India. Remittances were also prompt even though the relevant money was shown as accrued to the DOS in the Accounts. Periodical reconciliation of amounts due and payable to the DOS had not been carried out.
http://www.expressbuzz.com/edition/...3s=&SEO=&SectionName=zkvyRoWGpmWSxZV2TGM5XQ==
ISRO arm plays favourites
Express News Service
First Published : 02 Jan 2009 08:18:00 AM IST
Last Updated :
BANGALORE: A performance audit of the Antrix Corporation Limited (ACL), the commercial arm of Indian Space Research Organisation (ISRO), has revealed many irregularities in the functioning of the company, including undue benefits to private companies.
The Express has a copy of the report of the Comptroller & Auditor General of India on the performance of Antrix Corporation Limited, which was tabled in the Lok Sabha in October.
The report highlights the following points: n ACL extended undue benefit to Space TV (Tata Sky) by reducing the rates originally accepted by the customer while entering into a longterm agreement. Due to a reduction in lease charge, there was a recurring loss of revenue of Rs 4.8 crore per annum, whereas revenue of another Rs 5 crore was foregone due to increase in free period by a month.
n The company allowed Reliance Communications Limited to bill for the bandwidth utilised by them instead of the bandwidth allocated to them.
Absence of a deemed supply clause in 16 contracts led to a loss of Rs 27.45 crore in revenue.
n The service charge on foreign transponders was voluntarily reduced by the company, resulting in a recurring loss of Rs 8.3 crore in seven cases. There were delays in recovery of quarterly recurring charges and service.
n Service Tax was not being collected from foreign hired transponders resulting in a likely liability of Rs 16.77 crore to the exchequer. However, service tax was collected from INSAT operations.
n Though the company was set up as the commercial arm of the Department of Space (DOS), several commercial contracts like with Prasar Bharati, New Sky Satellite, Netherlands and INTELSAT were not entrusted to the company.
n ACLs non-operational revenue (interest earned from deposits in banks) averaged around 50 per cent of the profit after tax during 2002-03 to 2006-07, which suggests that the company was used as a special purpose vehicle for unutilised funds by the DOS.
n Despite having substantial cash balances, ACL had not developed proper procedures to increase its yield from the surplus cash retained by it.
n There were delays in revenue recognition or raising bills and important contractual provisions in respect of performance bank guarantee, surrender or termination of leased capacity were not followed.
n Company-specific guidelines and procedures for investments, personnel and accounts had not been developed even 15 years after the companys creation in 1992 and despite Governments clear directive.
n The functional distinction between the company and the DOS was ambiguous since the departments officers were also executives of the company. Proper delegation of powers consistent with good governance, structure and growth of the company had not been drawn.
n ACL credited the DOS share of revenue to ISRO instead of the Consolidated Fund of India. Remittances were also prompt even though the relevant money was shown as accrued to the DOS in the Accounts. Periodical reconciliation of amounts due and payable to the DOS had not been carried out.