A Legislative Assembly committee, set up to probe misappropriation of funds under the Public Works Department (PWD) at Magadi town in Ramanagara district, has recommended that the loss to the exchequer be recovered from the guilty officials, besides initiating disciplinary action against them.

The seven-member committee, headed by the then BJP MLA Appu Pattanashetty, found that the PWD officials at all levels, from secretariat to local engineers, are guilty of misappropriation of funds meant for civil works, like construction of roads, culverts, drainage and bridges in 2011-12. The scam came to light when Siddaramaiah, who was the Leader of the Opposition, raised the issue in November 2012, and demanded a probe. The scam runs to the tune of Rs 600 crore.

Though the committee found nexus between the officials and the contractors in the scam, there is no mention of involvement of any elected representative anywhere in the report. 
Exact amount not known

The committee has also not mentioned the exact amount of loss to the exchequer, due to the scam.

The local PWD officials, including executive engineers and superintending engineers, favoured three contractors while awarding a majority of civil works in the division. Works were split

To avoid going through the Transparency Act and e-tendering process, all the works were split into hundreds of small contracts within Rs 20 lakh each. 

In some instances, billing has been done to the same work several times and money drawn illegally.

Though Magadi town was entitled to about Rs 20 crore for the PWD road development works in 2011-12, the department sanctioned about Rs 259 crore without any approval from the government, the report stated. 

Among the officials found guilty was Govinda Raju, the then internal financial advisor of the PWD. 

“The system of release and sanction of projects and funds in the PWD should be revised. Officials are misusing their power leading to scams,” the report stated.

The committee also said the scam is only a tip of the iceberg. Similar instances of misappropriations have been happening in other parts of the State.