31TJ StU,*41g -500 004 OFFICE OF THE PRINCIPAL ACCOUNTANT GENERAL (AUDIT) ANDHRA PRADESH, HYDERABAD - 500 004. Lr. No.PAG(Audit)/APIEAP&SAR/2018-19/ 1 j 5 26.12.2018 To The Project Director, MSU-APMDP, 2"d Floor, Kavyasri Residency, ESR Colony, Inner Ring Road, Guntur - 522 034,Andhra Pradesh. Sir, Sub: Issue of Audit Certificate for the year 2017-18 in respect of Andhra Pradesh Municipal Development Project (APMDP), Credit No.7816- IN) I am to forward the reports of Comptroller and Auditor General of India for the year 2017-18 in respect of World Bank assisted "Andhra Pradesh Municipal Development Project (APMDP), Credit No.-7816-IN) along with enclosures viz., 1. Statement of Expenditure, Admittance, Disallowance and amount reimbursable for the year 2017-18 (Annexure-1) 2. Statement showing details of disallowances made from expenditure incurred for the year 2017-18 ( Annexure-II) 3. Statement showing the details of disallowances made from the expenditure incurred in the year 2017-18 out of unspent balances of 2015-16 and 2016- 17 (Annexure-1I1) 4. Statement showing the details of disallowances of previous years released now in 2017-18 (Annexure-IV) Receipt of the above mentioned documents may please be acknowledged. Enc: As above Yours faithfully, Dep y A Gunt t General/SS E-Mail: agauandhrapradesh2@cag.gov in Fax No 040-23210125 INDIAN AUDIT AND ACCOUNTS DEPARTMENT O/o The PRINCIPAL ACCOUNTANT GENERAL (AUDIT) ANDHRA PRADESH, HYDERABAD 500 004 To The Project Director, MSU-APMDP, 2nd Floor, Kavyasri Residency, ESR Colony, Inner Ring Road, Guntur - 522 029, Andhra Pradesh Report on the Project Financial Statements We have audited the accompanying financial statements of the "Andhra Pradesh Municipal Development Project (APMDP)" financed under World Bank Loan No.7816-IN/IDA which comprise the Statement of Sources and Applications of Funds and the Reconciliation of Claims to Total Applications of Funds for the year ended 31" March 2018. These statements are the responsibility of the Project Management wing. Our responsibility is to express an opinion on the accompanying financial statements based on our audit. We have conducted our audit in accordance with the Auditing Standards promulgated by the Comptroller and Auditor General of India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. Our audit examined, on a test basis, evidence supporting the amounts and disclosures in the financial statements. It also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the Project Financial Statements present fairly, in all material respects, the sources and applications of funds of "Andhra Pradesh Municipal Development Project (APMDP)" for the year ended 31st March 2018 in accordance with Government of India accounting standards. In addition, in our opinion, (a) with respect to SOEs, adequate supporting documentation has been maintained to support claims to the world bank for reimbursements of expenditure incurred; and (b) except for ineligible expenditure of Rs. 36,28,94,586/- as detailed in the audit observations and annexures, appended to this audit report for the year 2017-18, the expenditures are eligible for financing under the Loan/Credit Agreement. During the course of the audit, SOEs and the connected documents were examined and these can be relied upon to support reimbursement under the Loan/Credit Agreement. No separate management letter is issued along with this report. This report is issued without prejudice to Comptroller and Auditor General of India's right to incorporate the audit observations in the Report of Comptroller and Auditor General of India being laid before Parliament/State or UT Legislature. DEPUTY AC OUN NT GENERAL (SS) 3IF~ ~1,~~UI~ -500 004 OFFICE OF THE PRINCIPAL ACCOUNTANT GENERAL (AUDIT) ANDHRA PRADESH, HYDERABAD - 500 004. AUDIT CERTIFICATE The Expenditure Statement/Financial Statement relating to "Andhra Pradesh Municipal Development Project (APMDP)", (Loan No.7816-IN/IDA) for the year ended 3 1" March 2018 attached hereto have been audited in accordance with the regulations and standards of audit of the Comptroller and Auditor General of India and accordingly included such tests of accounting records, internal checks and controls and other auditing procedures necessary to confirm. a) that the resources were used for the purpose of the project and b) that the expenditure statements/financial statements are correct During the course of the audit referred to above, Statement of Expenditure (SOE) for an amount of Rs.76,48,91,389/- and the connected documents were examined and these can be relied upon to support reimbursement under the aforesaid loan/credit agreement. On the basis of the information and explanations that have been obtained as required and according to the best of our information as a result of the test audit, it is certified that the expenditure statement/financial statements read with the observations set out below represent a true and fair view of the implementation (and operations) of the project for the year 2017-18. This certificate is issued without prejudice to CAG's right to incorporate any further/detailed audit observations if and when made in the Report of CAG of India for being laid before Parliament /State Legislature. Yours faithfully, ~~iaacutanAlaa auta Allada) epu Accountant General/SS E-Ma il: agauandhrapradesh2@cag govJ)n Fax No 040-23210125 Draft Certification Audit Report for issue of Audit Certificate in respect of World Bank Assisted Andhra Pradesh Municipal Development Project (APMDP), IBRD Loan No. 7816-IN for the year 2017-18. Dates of Audit: 05-09-2018 to 26-10-2018 (37 working days) The Andhra Pradesh Municipal Development Project (APMDP) is an externally aided project being implemented with the support of International Bank for Reconstruction and Development (IBRD). The Project period of APMDP is 2009-2015 which was extended up to 31-12-2018. The Project Implementing Agency is the Commissioner & Director of Municipal Administration, Government of Andhra Pradesh. Andhra Pradesh Municipal Development Project (APMDP), on behalf of Government of India, entered into a Loan Agreement with IBRD for Loan No. 7816-IN on 22-01-2010. The Project consists of four components A, B, C& D. The components A and B are exclusively implemented by Municipal Strengthening Unit (MSU). Component 'C' Urban Infrastructure and Investment is being implemented by Andhra Pradesh Urban Finance and Infrastructure Development Corporation Ltd (APUFIDC) which sanctions and releases Loans and Grants under this Component to the identified Urban Local Bodies (ULBs). The APUFIDC acts as Trustee and plays as an advisory role for implementing the works under 'C' component. Component 'D' is Project Management and Technical Assistance, being implemented by MSU and APUFIDC. The strategic objectives of the project are: V Universal coverage including slum households being provided with individual water connections; / Preparing the ground to eventually move towards provisions of continuous water supply (24X7) V Sustainability at the local level, including financial, social and environment sustainability as per the APMDP frame work. As per the agreement the loan is distributed for the following four components: Component Nature of the service World Bank shae A State Level Policy and Institutional Development 100% Support B Municipal Capacity Enhancement 100% C Urban Infrastructure Investment 85% D Project Management Support100% During the year 2017-18 an amount of Rs.276.43 crore was received by APMDP and out of which an expenditure of Rs.76.49 crore was incurred. The audit party verified the expenditure details of the APMDP for the year 2017-18 and also the expenditure made out of the releases made in the years 2015-16 & 2016-17 but expenditure met in the year 2017-18 and proposed the following disallowances in parts A & B respectively. (A) The details of disallowances for the year 2017-18 out of the releases of 2017-18 are as detailed below: Para - I - Amount not utilized out of the releases for the year 2017-18 - Rs.34.26 Crore. (Component-C) Out of the amount of Rs.37.00 crore released during 2017-18 by Andhra Pradesh Urban Finance and Infrastructure Development Corporation (APUFIDC), the amount to the tune of Rs. 34,26,38,527/- was not expended by the ULBs as detailed below, and the same were kept under disallowance for the current year. SI. No. Name of the ULB Amount Amount Amount Released (Rs) Expended (Rs.) remained un- utilised (Rs.) 1 Vizianagaram 5,00,00,000 2.18,67,345 2,81,32,655 2 Kakinada 20,00,00,000 54,94,128 19,45,05,872 3 Badvel 12,00,00,000 0 12,00,00,000 TOTAL 37,00,00,000 2,73,61,473 34,26,38,527 Para.H- Recovery of Income Tax Rs.1.86 crore (Component-B& D) As per Manual of Standing orders (Audit), Chapter 17, Income Tax recovered from the contractor is claimable for civil works but not for supplies made. On scrutiny of records Audit observed that an amount of Rs.1,86,33,989/- was proposed to be disallowed towards recovery of IT on purchase of materials and Income Tax deducted on consultant payments as detailed below: Sl.No Name of ULB Income Tax 1 Municipal Strengthening Unit 1,86,33,989 (MSU)- APMDP, Guntur TOTAL 1,86,33,989 Para.II- Further Security Deposit (FSD) of Rs.13.27 lakh (Component-C) As per Para 3.17.2lof MSO (Audit), Chapter 17, amount recovered towards Security Deposits (SD) are not eligible for reimbursement. However, release of Security Deposits to the agencies is eligible. On Scrutiny of records Audit proposed an amount of Rs. 13,26,697/- to be disallowed from the Vizianagaram ULB pending adjustment of FSD to the contractor as detailed in the table below: SLNo Name of ULB Amount I Vizianagaram 13,26.697 TOTAL 1326,697 Para.IV - Recovery of Liquidated Damages (LD) and Penalties - Rs. 1.42 lakh (Component - C) Amounts recovered from the Contractor's Bills towards Liquidated Damages (LD) and Penalties are not reimbursable as the penalties and liquidated damages are not an expenditure and is a revenue to the department. On scrutiny of records Audit observed that an amount of Rs. 1,42,33 1/- was proposed to be disallowed from the Vizianagaram ULB towards recovery of Liquidated Damages and Penalties as detailed below: Sl.No Name of ULB LD Penalty 1 1 Vizianagaram 14,703 1,27,628 TOTAL 14,703 1,27,628 Para.V- Expenditure not related to APMDP disallowed for Rs.1.53 lakh (Component- B) The expenditure made in respect of the World Bank assisted Project "APMDP" would be allowed and reimbursable. However scrutiny of records Audit observed that the following expenditure made by MSU to the tune of Rs. 1,53,042/- was not related to the project and hence disallowed: Sl. No. Name of the Reason for disallowance Amount (Rs.) Unit 1. MSU Expenditure for staff attending Bruhat Benguluru 77,822 Mahanagar Palika for studying the State Government's plans for providing subsidized food through Anna Canteens to the poor 2 MSU Expenditure incurred by Municipal 75,220 Commissioner, Mangalagiri for Training Prograune wider AMRUT Refoins 153,042 (B) The details of disallowances out of the releases of 2015-16 & 2016-17 (unspent balances) and expenditure made during 2017-18 are as detailed below: Para.I- Further Security Deposit (FSD) of Rs.40.05 lakh (Component-C) As per Para 3.17.2lof MSO (Audit), Chapter 17, amount recovered towards Security Deposits (SD) are not eligible for reimbursement. However, release of Security Deposits to the agencies is eligible. Scrutiny of records revealed that an amount of Rs.40,05,665/- is due to be released to the contractors and hence proposed to be disallowed pending adjustment of FSDs to the contractors as detailed below: SI.No Name of ULB Amount I Vizianagaram 21,26,025 2 Budvel 60,404 3 Guntur 18,19,166 TOTAL 40,05,595 Parall- Recovery of VAT & Income Tax Rs.5.36 crore (Component-B,C, D) As per chapter 17 of the MSO (Audit), Income Tax and Sales Tax/VAT recovered from the contractor/s is claimable for civil works but not for supplies made. Scrutiny of records in Audit revealed that an amount of Rs.5,36,05,335/- was proposed to be disallowed towards recovery of VAT& IT on purchase of materials and Income Tax deducted on consultant payments as detailed in the table below: SLNo Name of ULB VAT Income Tax GST I Vizianagaram 8,00,839 2 Kakinada 84,66,714 52,77,168.__ 3 Badvel 15,76,582 9,63,372 4 Ananthapuramu 92,34,672 1,05.73,998 5 Gun tur 97,57,9311 44,81,002 9,64,638 6 Markapur 9,94,571 5,13,848 TOTAL 3,08,31,309 2,18,09,388 9,64,638 Para.M - Recovery of Liquidated Damages, Withheld amounts and Penalties - Rs. 17.13 lakh (Component - C) Amounts recovered from the Contractor's Bills towards Liquidated Damages (LDs), Withheld amounts and Penalties are not reimbursable from the world bank as they are in the nature of revenue to the project rather than expenditure. On scrutiny of records Audit observed that an amount of Rs. 17,13,237/- was recovered by way of Penalties, Liquidated Damages and Withheld amounts. Hence, an amount of Rs. 17.13 lakh is disallowed as detailed below: SI.No Name of LILB Withheld LD Penalty I Vizianagaram 1,00,000 1,83,232 1,60,753 2 Kakinada - - 2,06,161 3 Budvel - 7,63,091 - 4 Guntur 3,00,000 - - Total 4,00,00 9,46,323 3,66,914 Para.1V - Incorrect procedure adopted in deducting recoveries - Excess payment made to contractor for Rs. 3.52 lakh disallowed (Component - C) According to Sl. No. 45 of General conditions of contract, the rates quoted by the contractor shall be deemed to be inclusive of VAT, sales tax and other taxes that the contractor will have to pay for the performance of the contract. Contrary to above, Audit observed that while payment of bills Running Account bills Ist & Part to M/s Chaitanya Constructions towards the work "Comprehensive Water Supply Service Improvements" in Vizianagaram Municipality" under Package-II (b) for construction of 500 KL ELSR, the corresponding VAT of Rs.1,17,500/- was added to the value of work done and the same was deducted as work recoveries. Further in lInd & part bill VAT amount of Rs. 1,17,500/- was added to the value of work done and no deductions towards VAT was made, thereby resulting in an excess payment of Rs.2,35,000 to the contractor. Hence, the total recovery made was "NIL" and this had resulted in excess payment to the contractor to a tune of Rs. 3,52,500/-, Hence the same may be recovered from the Contractor and the amount to that effect was disallowed for the year 2017-18. On this being pointed out the department replied that the recoveries would be effected and audit intimated. Para V- Payments to clearance/shifting/Road Restoration Rs. 139.58 lakh (Comp-C) Utility Shifting charges & Road Restoration Charges are not reimbursable as per the provisions of the world bank assisted projects. Scrutiny of records revealed pertaining to works bills of Kakinada, Guntur and Markapur revealed that an amount of Rs. 1,39,57,599/- was paid for Road Restoration of the ULBs as detailed below. Hence, an amount of Rs. 1,39,57,599/- was disallowed. When this was brought to the notice the department stated the utility shifting and road restoration charges are paid as per the general G.Os issued by the Government of Andhra Pradesh. The reply is not acceptable as the stipulations of world bank doesn't provide for payments to utility shifting and road restoration charges. SI.No Name of ULB Amount (Rs.) 1 Kakinada 4,12,223 2 Guntur 1,32,65,376 3 Markapur 2,80,000 TOTAL 1,39,57,599 ParaVI - Recovery of Sand Charges - Rs. 34.31 lakh (Component-C) Government vide G.O. Ms. No.125, Water Resources (WRG-GRC) Department, dated 2-12- 2016 read with Government Memo No. 3066/M-1 1(1)/2016-3 dated 4-3-2016 of Industries & Commerce (M.II) Department changed the sand policy and the sand shall be made available to the public free of charge w.e.f. 02-03-2016 and issued guidelines to recover the difference of cost of sand from the work bills of existing agreements concluded as per the earlier rates and continued to be in force after 02-03-2016. However, as seen from the works bills an amount of Rs.34.31 lakh was excess paid to the contractors towards sand charges as detailed in the table below and hence disallowed. On this being pointed out the Executive Engineer replied that the amounts will be recovered from the contractors in the future Running Account bills. SIL No. Name of the ULB Amount 1 Kakinada 18,61,407 2 Ananthapuramu 15,70,173 TOTAL 34,31,580 Para.VII - Unadjusted Mobilization Advance for Rs. 841.07 lakh disallowed (Component - C) As per the provisions of Manual of Standing Orders (Audit) mobilization advance paid to the agencies is reimbursable. However, since the Mobilization Advance is not yet recovered from the contractors/agency the unadjusted Mobilization Advance of Rs.8,41,07,229/- is disallowed as detailed below. When this was brought to the notice the Commissioner, Municipal Corporation, Anantapuramu stated that the outstanding mobilization advance was recovered in the 16t RA & Part Bill. However, no Measurement Books (MBs) were furnished by the office and hence the unadjusted Mobilization Advance is disallowed pending adjustment. SI. No. Name of the ULB Name of the Agency Amount 1 Ananthapurarnu M/s Indian Hume Pipes 4,21,85,456 2 Guntur M/s Megha Engineering 3,31,49,976 3 Markapur M/s Ramky Infra 87,71,797 TOTAL 8,41,07,229 Para - VII - Excess amount paid to contractor due to incorrect application of BOQ rates Rs. 2.08 Iakh (Component - C) Name of the contractor: M/s Megha Engineering & Infrastructure Ltd. Hyderabad. Name of the package: Comprehensive Water Supply Service Improvement Project (CWSSIP), Guntur Package -II As per Bill of quantities (BOQ), the Supply, and delivery of centrifugally cast (spun) Ductile Iron Pressure pipe for water, gas and sewerage with socket spigot ends confirming to IS: 8329/2000 in standard working lengths of 4.0m, 5.0m, 5.50m & 6.Om for push-on -joint ( Rubber Gasket D jointing) with cement mortar lining inside the pipe without side zinc coating, inclusive of sales tax, transportation etc., including VAT and labour cess but excluding Central Excise Duty (CED) vide agreement no. 01/2013-14, Dt: 13.06.2013, the rate and no. of quantity is as follows: Item no Description Rate per Rmt Quantity (Rmt) 107.7 350 mm DI K7 pipes 2857 5245 107.8 300 nun DI K7 pipes 2283 13028 During the scrutiny of the voucher no. 06 dt: 20.06.2017 in respect of RA bill No. 12 & part along with measurement book and bill of quantities, it was observed that an amount of Rs. 2,07,948/- was excess paid (in earlier RA Bills) to contractor towards laying and jointing of DI pipes (15% releases on cost of Pipes) due to incorrect application of BOQ vide Sl No. 107.7 and 107.8 as per agreement i.e quantity of laying of pipes is more than the supply as detailed below SI. No Description of work Quantity of Supply and Excess Rate for Excess vide work done as laying quantity laying amount paid BOQ per M. book Quantity laid more and to contractor as per BOQ than the jointing (Rs) ____ ____ ___ ____ ___ ____ ___ _ __ ___ ____ __ ____ ___ supply_ _ _ _ _ _ _ 107.7 350mm DI K7 pipes 5339.65 5245.00 94.65 Rs. 40562.25 supplied and laid quantity Rmt 428.55/- per Rmt 107.8 300mm DI K7 pipes 13516.79 13028.00 488,79 342.45/- 167386.13 supplied and laid quantity per Rmt TOTAL 207948.38 When this was brought to the notice the Project Manager replied that excess payment will be recovered in future bills from the contractors and hence disallowed. Para- IX- Non-recovery of Seignorage on Earth -Rs. 0.68 lakh (Component - C) Name of the contractor: M/s GKC Projects Name of the package: Comprehensive Water Supply Service Improvement Project (CWSSIP), Kakinada Package -I While scrutiny of records pertaining to the above project audit observed from the RA bill No,XVI and part, for which payment was made to the Contractor for the value of the work done (Vr.No. 12 Dt.7-8-2017), that seignorage charges were not recovered for the following item of work executed and paid in this voucher as detailed below and this has resulted in excess payment of Rs.68,438. Item no. 2801: "Filling up of low-lying area with the carted excavated earth from Project sub-components at ELBR" Quantity Executed = 3421.88 cum Seignorage charges @ Rs.20 per cum of earth to be levied = Rs. 68437.60 i.e., (Rs.20 * 3421.88) When this was brought to the notice the Executive Engineer, Municipal Corporation, Kakinada replied that the seignorage charges would be recovered from the contracting agencies in the further RA bills. Para.X Excess amount paid to contractor due to incorrect application of BOQ rates Rs. 0.54 lakh (Component - C) Name of the contractor: M/s Ramky Infrastructure limited, Hyderabad. Name of the package: Comprehensive Water Supply Service Improvement Project (CWSSIP), Markapur As per Bill of quantities (BOQ), the item no. 214.1 to 214.4 - "Supply, and delivery of HDPE pipes PE-100 grade (6ksc)" conforming to IS 4984-1995 including transportation to anywhere in AP, including Sales tax, VAT and labour cess but excluding CED and specials etc vide Agreement No. 58/2012-13, Dt: 07.01.2013, the rate and no. of quantity of and is as follows: Item no in Description Rate per Rmt Quantity (Rmt) agcement 214.1 110 mn dia HDPE pipes Rs. 337 53530 214.3 225 inm dia HDPE pipes Rs. 1402 1850 During scrutiny of voucher no 07 dt: 05.12.2017 in respect of RA bill no.16th and part bill along with measurement book and bill of quantities, Audit observed that an amount of Rs. 53,708/- was excess paid to the contractor towards laying and jointing of HDPE pipes due to incorrect application of BOQ vide sl.no. 215.1 and 215.3 as per agreement i.e quantity of laying of pipes is more than the supply as detailed below: SI. No Description of Quantity of Supply and Excess Rate for Excess vide work work done as laying of quantity laying and amount- BOQ per M. book Quantity as laid jointing paid to per BOQ more contractor than the (Rs) supply 215.1 110 mm dia HDPE 53956.42 Rmt 53530.00 Rmt 426.42 Rs. 83/- per 35392.86 _______ ipesrmt 215.3 225 m dia HDPE 1949 Rmt 1850 Rmt 99.00 Rs. 185/- 18315.00 per rmnt TOTAL 53707.86 When this was brought to the notice the Deputy Executive Engineer, Markapur replied that the excess paid amount will be recovered from the contractor and hence the amount is disallowed for reimbursement. Para - XI -Excess amount paid to contractor due to incorrect application of ROQ rates Rs. 1,54,316/- Name of the contractor: M/S The Indian Hume Pipe co, ltd. Name of the package: Comprehensive Water Supply Service Improvement Project (CWSSIP), Ananthapuramu Package -I As per Bill of quantities (BOQ) the rate of item no.221 - Supply, collection, stacking & filling of sand for bedding of Cement Concrete (CC) roads including cost & conveyance of all materials & labour charges, seignorage charges, filling tamping charges etc complete as per S.S vide Agreement No. 23/2015-16, Dt: 31.03.2016 is Rs.391/-, During the scrutiny of the voucher no. 35 dt: 14.03.2018 in respect of RA Bill No. XVI & part along with measurement book and BOQ, Audit noticed that an amount of Rs. 3,31,259.28 (at rate of Rs. 732/- per cum) has been paid instead of Rs.1,76,943.14 (at rate of Rs. 391/-) due to incorrect application of BOQ vide SI.No.221 as concluded in the Agreement and this has resulted in the excess payment of Rs.1,54,316.14/- made to the contractor as detailed below and hence disallowed for reimbursement. SI. No Description of work Quantity of Rate as Rate as Excess amount vide work done per BOQ per M. paid to BOQ as per M. Book contractor (Rs) book 221 Supply, collection, stacking 452.54 cum Rs.391/- Rs. 732/- 154316.14 & filling of sand for per cum per cum bedding of CC roads [452.54 * (732- including cost & 391)] conveyance of all materials & labour charges, seignorage charges, filling tamping charges etc __complete as per S.S When this was brought to the notice the Commissioner, Municipal Corporation, Anantapuramu replied that excess amount paid will be reconciled and corrected as per original and supplemental agreements concluded and amount would be adjusted from the future RA bills. Para - XII-Unspent amount out of the releases for the years 2015-16 & 2016-17 continued as further disallowance - Rs. 80.63 crore (Component-C) It was observed that the following amounts out of the releases for the years 2015-16 & 2016- 17 have still remained unutilized till the end of 2017-18 and hence continued as disallowance as detailed below: SI.No Name of the ULB Year of release Amount (Rs.) I Ananthapuramu 2015-16 24,35,76,558 2 Badvel 2015-16 & 2016-17 3,45,98,126 3 Guntur 2015-16 &'2016-17 44,77,89,636 4 Markapur 2015-16 & 2016-17 8,03,13,161 TOTAL 80,62,77,481 Deputy econ ant General (SS) Annexure-I STATEMENT SHOWING DETAILS OF EXPENDITURE INCURRED Le., CATEGORY WISE, COMPONENT WISE, UNIT OFFICE WISE/DISTRICT WISE FOR THE YEAR 2017-18 IN RESPECT OF WORLD BANK ASSISTED ANDH-RA PRADESH MUNICIPAL DEVELOPMENT PROJECT (Loan No. 7816-IN) Actual Expenditure Expenditure Percentage Category/ Year of allowed for Amount SI.No Name of the Component Yea SOE figure Expenditure as disallowed in admitted in Component release . reimburseme reimbursable verified in audit audit audit nt 1 A State Level Policy and Institutional Development 2017-18 9838189 9838189 0 9838189 100% 9838189 2 B Municipal Capacity 2nhMnce ty 2017-18 335247968 335247968 18421121 316826847 100% 316826847 Enhancement 3 C Urban Infrastructure Investment 2017-18 370000000 370000000 344107555 25892445 85% 22008578 4 D Project Management and Technical Assistance by 2017-18 49805232 49805232 365910 49439322 100% 49439322 CDMA & APUIF TOTAL 764891389 764891389 362894586 401996803 398112936 PREVIOUS YEARS (2015-16 &2016-17) VERIFIED AND ALLOWED NOW (2017-18) 5 Unencashed cheques of A,B,D previous year and other 0 0 0 17672865 100% 17672865 disallowances 6 Amount verified and admitted as a result of review C of disallowances made from 2069253933 968008283 1101245650 85% 936058803 the expenditure incurred during the years 2015-16 & Audit Officer/EAP&SAR(SS) ANNEXURE II STATEMENT SHOWING THE DETAILS OF DISALLOWANCES MADE FROM THE EXPENDIUTRE INCURRED DURING THE YEAR 2017-18 IN RESPECT OF WORLD BANK ASSISTED ANDHRA PRADESH MUNICIPAL DEVELOPMENT PROJECT (Loan No. 7816-IN) Sl.No Compon Unit Reasons for disallowance AE no. Page No. Amount . ent I C Vizianagaram Expenditure not incurred out of the 5 122 28132655,00 Municipality release for the year 2017-i8 2 C Vizianagaram FSD, LD, Penality amounts on works 3 100 1469028.00 Municipality expenditure of amount pertaining to 2017- 18 release (Rs.50000000-Rs.28132655= 21867345) 3 C Municipal Expenditure not incurred during 2017-18 3 194 194505872.00 Corporation, Kakinada 4 C Badvel Amount not expended out of the releases 3 592 120000000.00 Municipality for the year 2017-18 5 B PD, MSU- Expenditure for staff attending Bruhat 6 1198 77822,00 APMDP Benguluru Mahanagar Palika for studying the web GIS Portal and State Government's plans for providing 6 B PD, MSU- Income tax paid to consultants is not 8 1216 18268079.00 APMDP reimburseable by World Bank 7 B PD, MSU- Expenditure incurred by Municipal 7 1202 75220.00 APMDP Commissioner, Mangalagiri for Training Programme under AMRUT Reforms for Municipal Tax and Fee Improvement Enhancement of Property Tax Collections, ect. As the training programme was under AMRUT scheme, expenditure incurred does not pertains to APMDP and is disallowed for reimbursement from World Bank 8 D Trust Secretary, The TDS deducted on the above 9 1218 313250.00 APUFIDC payment for Rs.3,13,250/- is disallowed for reimbursement from World Bank as Income Tax paid to consultants is not reimbursable unless 9 D PD, MSU- Income tax paid to consultants is not 8 1216 52660.00 APMDP reimburseable by World Bank TOTAL 362894586.00 Audit Officer/EAP&SAR(SS) ANNEXURE 111 STATEMENT SHOWING THE DETAILS OF DISALLOWANCES MADE FROM THE EXPENDIUTRE INCURRED DURING THE YEAR 2017-18 OUT OF THE DISALLOWANCES (UNSPENT BALANCES) MADE IN THE YEARS 2015-16 & 2016-17 IN RESPECT OF WORLD BANK ASSISTED ANDHRA PRADESH MUNICIPAL DEVELOPMENT PROJECT (Loan No. 7816-IN) SLNo. Component Unit Reasons for disallowance Amount Disallowed (in Rs) 1 C Vizianagaran Municipality VAT, FSD, LD. Penalties & WH amounts 3444166.00 on works expenditure of amount pertaining to closing balance of 2016-17 (Rs. 35971777) and release of 2015-16 not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 2 C Vizianagaram Municipality Excess payment on account of VAT on 352500.00 wvorks expenditure of amount pertaining to 2016-17 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 3 C Municipal Corporation, VAT. FSD., LD. Penalties & WH amounts 14362266.00 Kakinada on works expenditure of amount pertaining to 2015-16 & 2016-17 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017- 18 4 C Municipal Corporation. Excess payment towards cost of sand on 1861407.00 Kakinada works expenditure of amount pertaining to 2016-17 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 5 C Municipal Corporation, Non-recovery of Seignorage charges form 68438.00 Kakinada M/s GKC Projects for "filling of low lying area with the carted excavated earth from project sub-component at ELBR" for a quantity of 3421,88 cum in CC XVI & Part 6 C Municipal Corporation, IT, VAT and excess sand cost recovered 21378843.00 Ananthapuramu amounts on works expenditure made during 2017-18 7 C Municipal Corporation., Excess payment made to contractor in 154316.00 Ananthapuramu Package-I 8 C Municipal Corporation, Unadjusted MobdiLation Advance disallowed 42185456.00 Ananthapuramu 9 C Municipal Corporation, Amount not expended out of the release for 243576558 00 Ananthapuramu the year 2015-16 (CB of 2017-18) 10 C Badvel Municipality VAT, FSD. LD & deposited amounts on 3363449.00 works expenditure of amount pertaining to 2015-16 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 II C Badvel Municipality Amount not expended out of the releases for 34598126.00 the years 2015-16 & 2016-17 12 C Municipal Corporation, Amount not expended out of the releases for 447799636 00 Guntur the years 2015-16 & 2016-17 13 C Municipal Corporation, Excess amount paid to the contractor due to 207948.00 Guntur incorrect application of BOQ rates (Package- * II) 14 C Municipal Corporation. Unadjusted Mobilization Advance disallowed 33149976.00 Guntur 15 C Municipal Corporation, Disallowance of VAT, FSD, LD & deposited 30588113.00 Guntur amounts on works expenditure of amount pertaining to 2015-16 & 2016-17 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 16 C Markapur Municipality Disallowance of VAT, FSD. LD & deposited 1788419.00 amounts on works expenditure of amount pertaining to 2015-16 & 2016-17 release not expended during that year and expenditure made during 2017-18 and admitted in Audit during 2017-18 17 C Markapur Municipality Unadjusted Mobilization Advance disallowed 8771797.00 18 C Markapur Municipality Excess amount paid to the contractor due to 53708.00 incorrect application of BOQ rates 19 C Markapur Municipalit\ Amount not expended out of the releases for 80313161.00 the years 2015-16 & 2016-17 ]TOTAL 968008283.00 __ Audit Officer/EAP&SAR(SS) Annexure-IV STATEMENT SHOWING THE DETAILS OF DISALLOWED AMOUNTS FROM EXPENDITURE OF PREVIOUS YEARS (2015-16 & 2016-17) NOW RELEASED IN RESPECT OF WORLD BANK ASSISTED ANDHRA PRADESH MUNICIPAL DEVELOPMENT PROJECT (Loan No. 7816-IN) SI. Name of the Unit Component Year of Amount disallowed Amount now Balance No. disallowance (Rs.) released (Rs.) disallowance (Packages) amount (Rs.) I z anagaamMunicipahity C 2015-16 35971777 35971777 0 C 2016-17 192064 0 192004 C 2016-17 1852579 0 1852579 C 2016-17 352092 0 352092 C 2016-17 5281382 5281382 0 2 Kakinada Municipality C 2016-17 102927598 102927598 0 C 2016-17 3228166 0 3228166 C 2016-17 4545174 0 4545174 C 2016-17 2600916 0 2600916 C 2016-17 2909621 0 2909621 3 Guntur Municipalitv C 2015-16 115660308 90081617 25578691 C 2016-17 282935240 282935240 0 C 2016-17 26940202 0 26940202 C 2016-17 934955 0 934955 C 2016-17 6062986 0 6062986 C 2016-17 300000 0 300000 0 4 Markapur Minicipalim C 2015-16 8629267 1402047 7227220 C 2015-16 36833340 1024956 35808384 C 2016-17 53585116 53585116 0 C 2016-17 2746380 0 2746380 C 2016-17 171586 0 171586 C 2016-17 552109 0 552109 0 5 Ananthapuramu Municipal C 2016-17 574636532 574636532 0 C 2016-17 15521627 0 15521627 C 2016-17 252821 0 252821 C 2016-17 16771286 0 16771286 C 2016-17 239589809 217408638 22181171 0 6 Budvel Municipalih- C 2015-16 3226985 2887216 339769 C 2016-17 67005186 67005186 0 C 2016-17 4919825 0 4919825 C 2016-17 81468 0 81468 7 MSU 2016-17 626330 626330 0 1B 2016-17 1851020 1851020 0 D 2016-17 826923 743000 83923 A,B & D 2016-17 14521614 14452515 69099 TOTAL 1635644284 1452820170 182224114 Audit Officer/EAP&SAR(SS)