Srinagar, May 11: Jammu and Kashmir State Accountability Commission Friday ordered an inquiry against the Minister of State for Cooperatives, Dr Manohar Lal Sharma, and senior officers of his ministry for their alleged involvement in embezzlement of crores of rupees and gross irregularities in the JK Cooperative Housing Corporation (JKCHC).
The inquiry has been ordered by SAC bench comprising its chairperson Justice YP Nargotra and member Justice Hakim Imtiyaz Hussain on the basis of a complaint and preliminary investigations into the case. The complaint against the Minister as also, former Commissioner Secretary Cooperatives, Abdul Hamid Wani and Registrar Cooperatives, Muhammad Abbas was filed on September 15, 2011, by Farooq Ahmad Dar and Sunil Sharma.
In its preliminary inquiry, the SAC has detected gross irregularities in the case and maintained that the Minister has failed to exercise an effective control over the functioning of JKCHC.
The SAC has directed the Minister to appear before it personally or through his counsel. In their complaint, the duo had alleged that an inquiry was conducted by Manohar Lal Sharma in respect of JK Cooperative Housing Corporation which revealed that embezzlement worth five thousand crores was committed by the a former and present Manager Directors of the Corporation.
“It alleged that the two MDs along with one Muhammad Shafi Dar, Assistant Registrar Cooperatives Department have misappropriated crores of rupees but no action was taken against them as the Minister Manohar Lal Sharma himself got bribe and a plot from the MD of the Corporation,” the complaint reads.
The complainants further alleged that despite remaining under suspension for five years in an embezzlement case, Muhammad Shafi Dar was reinstated at the behest of the Minister.
“In Jammu and Kashmir Cooperative Bank Ltd, there is misappropriation of Rs 259 crores which have been looted by Minister Cooperative and concerned Commissioner Secretary and Registrar. Besides 600 illegal appointments have been made at the behest of the Minister and these officers. Only 25-30 percent funds received from Government of India have been utilized and rest have been embezzled,” the complaint says.
The SAC had sent a show-cause notice to the respondents to seek their response against the allegations in the complaint. In their response, the respondents have refuted the allegations.
After examining all aspects of the case, the SAC has detected gross irregularities in the JKCHC.
 “From replies and documents on file, we find that earlier also an inquiry has been conducted in the matter which revealed that the management has conducted transactions of crores of rupees every year but no account has been maintained which could reflect total land purchased and actual stock in hand on any particular date. This has created misrepresentation of accounts,” the SAC states in its 15-page order.
The SAC states that it has been further found that losses incurred during 2006-07 to 2008-09 have gone up to 5025.86 lakh and the net accumulated losses of the Corporation reached to 9230.48 lakh by the end of financial year 2008-09.
“It appears prima facie that earlier management of the Corporation has not made expenditure of the development funds in a judicious way which has resulted in the financial mismanagement. This would show there was lack of proper control and inaction on the part of the Minister concerned.”
The SAC also pointed out that no tender system has been followed in allotment of works. “Besides no CDRs have been obtained from the contractors. Neither any specific mode has been adopted to make payments to contractors nor the progress of work done has been recorded on measurement books. The mandatory deductions like TDS, service tax, income tax have not been deducted from the payment of the contractors.”
The SAC in its preliminary investigation has found that Corporation has not obtained requisite permission for establishment of big colonies from the respective development authorities and town planning departments.
“Advance payments of Rs 195 lakh were made by the Corporation to Goodwill CHBS Ltd Kathua from November 11, 2006 to March 17, 2010 and no land was purchased from the society during this period. The amount remained unutilized for such a long period,” the SAC states in its order.
The SAC states that borrowings and liabilities of the corporation ending March 2008 have mounted to Rs 2786.56 lakhs against the LIC and Rs 9074.62 lakhs against the HUDCO.
“The management owes responsibility to explain wherefrom such a sizable amount can be made good. Delina project Baramulla was started vide an agreement on 30-3-2002 between the then MD and one Farooq Ahmad Lone to purchase/sell 400 kanals of land at the rate of Rs 1.45 lakhs per kanal. Subsequently some land was purchased at the rate of Rs 1.66 lakhs per kanal in violation of the agreement. The cost of the land purchased was worked out at Rs 5,31,42,500 whereas the Corporation made the payment of Rs 5,57,45, 975 resulting in excess payment of Rs 26,03,475. In this way direct loss of Rs 26.03 lakhs has occurred.”
“Prima facie it appears that gross irregularities have been committed by the officers of the Corporation and the Minister for Cooperative Department has failed to exercise an effective control over the functioning of the Corporation. On consideration of the matter, we find a prima facie case is made out for regular enquiry against Dr Manohar Lal Sharma and the officers named in the complaint on the allegations mentioned in the complaint,” the Bench stated in its order.
The SAC also issued notice to the respondents for their appearance in person or through advocates within three weeks.
The SAC asked the Vigilance Organization, which has already registered a case in the matter, to submit present status on the case to the Commission. The case is listed for hearing on June 6.

Lastupdate on : Fri, 11 May 2012 21:30:00 Makkah time
Lastupdate on : Fri, 11 May 2012 18:30:00 GMT
Lastupdate on : Sat, 12 May 2012 00:00:00 IST