New Delhi: The Comptroller and Auditor General of India (CAG) has found number of shortcomings in the implementation of the Rs 52,000 crore farm debt waiver scheme pointing out that thousands of beneficiaries were not eligible while those eligible were denied the benefits.
Report of the CAG, tabled in Parliament on Tuesday, also discloses violation of the guidelines for implementation of the scheme with a private schedule commercial bank shown to have received reimbursement for loan of Rs 164 crore extended to Micro Finance Institutions (MFIs).
There was also prima facie evidence of tampering, over writing and alteration of records, the report said.
The CAG noted "the monitoring of the scheme was also found to be deficient".
It has recommended immediate corrective measures to take action like recovery of money paid to ineligible beneficiaries and loans extended to MFIs, action against bank official and auditors and filing of FIRs in cases of tampering of records, issue of debt waiver and debt relief certificates to farmers.
Pointing out errors of inclusion and exclusion, the report said "out of 9,334 accounts test checked in audit across nine states, 1,257 accounts (13.46 per cent) were those which were found in audit to be eligible for benefit under the scheme, but were not considered by the lending institutions while preparing list of eligible farmers".
Further out of 80,299 accounts granted debt waiver or relief, in "8.5 per cent of cases, the beneficiaries were not eligible for either debt waiver or the debt relief".
The report deals with Agricultural Debt Waiver and Debt Relief Scheme (ADWDRS) 2008 under which 3.69 crore small and marginal farmers and 60 lakh other farmers were given debt relief to the extent of Rs 52,516 crore.
"Overall, the Performance Audit revealed that in ...(22.32 per cent of cases test checked) there were lapses/errors which raised serious concern about the implementation of the scheme," it said.
The CAG has also pulled up the Department of Financial Services (DFS) in the Finance Ministry for deficient monitoring of the multi-crore scheme.
The report suggested that the DFS may take steps to review beneficiary lists in selected banks by focusing on those states where indebtedness was high.
"Bank officials, internal auditors and central statutory auditors, who certified the information for passing the claims, ought to be made accountable for lapses in performing their duties," the CAG recommended.
The CAG report has also pointed out that banks also claimed undue benefits like penal interest, legal charges, miscellaneous charges from the government. Under the scheme, banks were supposed to bear these charges themselves.
Referring to tampering of records, CAG suggested the DFS should review such cases and take "stringent action" against erring officials and banks.
After extending benefit under the scheme, the banks were required to issue a certificate and obtain an acknowledgement from the farmer for the same.
However, the report found in several cases "the lending institutions had not obtained acknowledgement from farmer".
Subsequent to the issue of draft audit report and exit conference, the DFS had advised the RBI and NABARD, the nodal agencies, in January to issue instructions to lending institutions for taking immediate corrective measures.
DFS instructed that institutions need to take action like recovery of money paid to ineligible beneficiaries and loans extended to MFIs, action against erring banks, fixing responsibility of bank officials as well as bank auditors.
The report said the audit observed that DFS and nodal agencies were aware of numerous flaws in the implementation of the scheme "yet they did not take adequate measures to rectify the same in timely manner".
It also said follow-up action in response to complaints or inspections should be properly monitored.