Chapter 1
PDS SYSTEM IN STATE OF
INTRODUCTION
1.1
ABOUT THE STATE OF
1.1.1
The 28th State of the Indian Union
was brought into existence by the Bihar Reorganization Act, 2000 on
1.1.2
As per 2001 Census, the Population
of the state of Jharkhand is
2,69,09,428. In Jharkhand the Per Capita
Income is Rs. 4161.00[1].
74.65% of its population resides in rural areas, 54% of its population in rural
area live below the poverty line. The road network of the state is very poor.
Jharkhand has 21.40 km per 100 sq km road as against national average of 74.25
km.[2]
1.1.3
Few important demographic details
of State of
Density of Population: 338 persons / Sq. KM
No. of Districts: 24
No. of Sub divisions: 35
No. of Blocks:
212
No. of Villages: 32,620
No. of Villages Electrified: 14,667 (45 % of
total)
No. of Villages connected by Road: 8484
Map of Jharkhand
1.1.4
The residents of Jharkhand are
mainly rice eaters and prefer parboiled rice instead of raw rice. The State is
however, getting more of raw rice from the Central Government.
1.2 TARGETED PUBLIC DISTRIBUTION SYSTEM
1.2.1
The Targeted Public Distribution
system was introduced w.e.f
1.2.2 PDS is operated under the joint
responsibility of the Central and the State Governments. The Central Government
has taken the responsibility for procurement, storage, transportation and bulk
allocation of foodgrains, etc. The responsibility for distributing the same to
the consumers through the network of Fair Price Shops (FPS) rests with the
State Governments. The operational responsibilities including allocation within
the State, identification of families below poverty line, issue of ration
cards, supervision and monitoring the functioning of FPS’s rest with the State
Governments.
1.2.3 The TPDS scheme classifies beneficiaries
in three categories Above poverty line (APL), Below
Poverty line (BPL) and Antodaya Anna Yojana (AAY) The price at which
they get the subsidized foodgrain is different for each Category. Under all these schemes, presently beneficiaries are entitled
for 35 Kg of food grain
1.2.4 Scale
of issue: Since 1997, the Scale of issue of BPL families has been gradually
increased from 10kg. to 35 kg per family per month. The scale of issue under
APL, BPL and AAY has been revised to 35 kg per family per month with effect
from 1.4.2002 with a view to enhancing the food security at the household level
and liquidating surplus stocks of food grains in the Central Pool[4].
1.2.5 Issue
Price: The end retail price is
fixed by the States after taking into account margins for
wholesalers/retailers, transportation charges, levies, local taxes etc. Under
the TPDS the States were requested to issue foodgrains at a difference of not
more than 50 Paise per kg over and above the CIP for BPL families. Flexibility
to States has been given in the matter of fixing the retail issue prices by
removing the restriction of 50 paise per kg over above the CIP for distribution
of foodgrains under TPDS except with respect to Antyodaya Anna Yojana where the
end retail price is to be retained at Rs. 2/kg for wheat and Rs. 3 /kg for rice[5].
1.2.6 Issue
Price for APL, BPL, AAY
Above Poverty Line (APL) beneficiaries are entitled to wheat @Rs. 6.61/kg and
Rice @ Rs. 8.96/kg .CIP is Rs. 6.10/kg for Wheat and Rs. 8.30/kg for Rice.
Below Poverty Line
(BPL) beneficiary gets wheat @ Rs 4.62/kg and Rice @
Rs 6.15/kg. Central issue Price (CIP) is Rs. 4.15 for Wheat and Rs. 5.65 for
Rice.
Under the Antodaya Anna Yojana
(AAY) Scheme, price at which beneficiary gets food grain and Central issue
Price (CIP) are same i.e. Wheat @ Rs 2/kg and Wheat @ Rs 3/kg.
1.2.7 Rs 2 Scheme (State sponsored scheme)
Food and Civil
Supply Department, Government of Jharkhand by the letter no. 1644 dated
01.11.2008 announced the Rs 2/- Scheme. Under this Scheme, the State of
1.2.8
The total number of cards issued in the State of
Total no. of APL cards 5.15 Lakh.
Total No. of BPL cards 16.67Lakh
Total No. of AAY
Cards 7.27 Lakh
1.3
AGENCIES INVOLVED
1.3.1 Food
Corporation of
1.3.2 Department of Food and civil supply
Jharkhand
1.3.3 Bihar
State Food and civil supply Corporation
1.3.1 Food
Corporation of
1.3.1.1
The State of
(Figures in
|
STATE |
FCI |
CWC |
SWC |
GRAND TOTAL |
|
JHARKHAND |
1.23 |
0.35 |
0.00 |
1.58 |
1.3.2 Department
of Food and Civil supply Jharkhand
ADMINISTRATIVE SET UP
Secretary
Commissioner,
Food
Divisional
Commissioner
Deputy
Director, Food
District
Supply Officer
Additional District Supply Officer
Marketing
officer
Supply
Inspector
ADMINISTRATIVE OFFICERS IN DISTRICT
Deputy
Commissioner
(DC is the
appellate authority in a District)
|
Sub
Divisional Officer(SDO) In Rural areas |
Special
Officer Rationing (SOR) In Town |
|
The SDO is licensing officer at
the Sub-Divisional level mainly in
rural areas |
SOR is Licensing authority at town level. In
Jharkhand SOR post is only in three
places |
In the State of
1.3.3
This Corporation acts as the agent of the State Govt. in
Bihar/Jharkhand in matters of procurement, transportation and handling, storage
and distribution of food grains to targeted PDS dealers and other Govt.
agencies. The company, being a Procurement , Storage and Distribution agency of
the State Government, procures foodgrains from FCI against monthly/ yearly
allotments made by the Central/State Government under various schemes. The
Company through its District offices deposits the cost of foodgrains to FCI and
obtains Release Orders (RO) from them for lifting and distribution to FPS
dealers.
1.4
ISSUE/ ALLOCATION
1.4.1 The GOI allocates in the State about
10.50
a)
Shortage of Railway Rakes
b)
Less number of Railway Terminals
c)
Shortage
of Storage Capacity
d)
Shortage
of Regional offices of FCI
1.4.2 There
are only 2 District offices of FCI, one in
1.4.3 FCI is feeding only those depots on
priority that are connected with broad gauge rail and depots connected by road
are not being fed regularly. The FCI does not issue food grains on the days
when railway rakes are unloaded as there is shortage of space for parking of
trucks, and there is only one weigh Bridge.
1.4.4 Allocation of foodgrains
Central
Government allocation to State Government
Procurement
by FCI as per State requirement
District
Wise allocation by State Government
Block Wise allocation from Districts
FPS
Allocation from Blocks
As per
allocation, Demand Draft deposit by FPS to SFO
Against DD,
SFC issue Stock Issue Order (S I O) to FPS
Collection
of Foodgrain by FPS from Block Godown
Transportation
of Food Grain to FPS Shops by FPS Owners
Provision
of Opening of Sale after inspection by Vigilance committee and Food inspector
Distribution
to Beneficiaries according to their entitlement/Card
Chapter 2
LEGAL FRAMEWORK
2.1 ESSENTIAL COMMODITIES ACT, 1955: The Essential Commodities Act
1955 (Act) is an Act to provide, in the interest of general public, for the
control of the production, supply and distribution of, and trade and commerce, in certain commodities.
i. Section
3 of the Act confers powers on the Central Government to control production,
supply, and distribution etc. of essential commodities. Central Government has issued an order called
Public Distribution System (Control) Order 2001 (Order), which was amended in
2004.
ii. Stringent
provisions have been provided in the Act and the Order, to deal with any
infringement of the provisions of the Act or the Order.
iii. Section
7 provides for penalties. Any person
contravening the Order is liable to be sentenced to imprisonment, which may
extend upto 7 years and shall also be liable to fine. Sentence of imprisonment cannot be less than
3 months unless there are adequate and special reasons. The property in respect of which
contravention of the Order has taken place, is liable to be forfeited to the
Government and so also any vehicle used in carrying such commodity. If a person commits offence a second time
then imprisonment cannot be less than 6 months subject to, adequate and special
reasons.
iv. Section
8 provides that a person who attempts to contravene or abets any contravention
of the Control Order is similarly liable.
v. Section
9 provides for punishment upto 5 years or fine or both, if the record is not
maintained in terms of the Control Order or any statement or information
furnished, which is not true.
vi. Section 10 deals with offences by
Companies, in which case every person who at the time of contravention was in
charge, is responsible for the contravention and shall be deemed to be guilty.
vii. Section 10A has made any offence
punishable under the Act cognizable.
viii. Section
10C provides that Court may presume the existence of such mental state where an
offence under the Act requires culpable mental state on the part of the
accused. “Culpable mental state”
includes intention, motive, knowledge or reason to believe a fact.
ix. Under
Section 11, a Court can take cognizance of an offence under the Act not only on
a complaint made by a public servant but also by any person aggrieved or any
recognized consumer organization.
x. An
offence for contravention of the Control Order is to be tried summarily
(Section 12A).
xi. If
an accused is sentenced to imprisonment for a period not exceeding one month and
of a fine not exceeding Rupees two thousand, no appeal can be filed.
xii. Section
14 provides that when a person is prosecuted for contravention of any order
which prohibits him from doing any act or being in possession of a thing
without lawful authority or without a permit, licence or other document, the
burden of proving that he has such an authority, permit, licence or other
document, shall be on him.
2.2
THE PUBLIC DISTRIBUTION SYSTEM (CONTROL) ORDER, 2001:
2.2(a) The Public Distribution System (Control)
Order, 2001 (hereinafter referred to as the ‘PDS Order 2001’) has been issued
by the Central Government in exercise of powers conferred by Section 3 of the
Essential Commodities Act, 1955 for maintaining supplies and securing
availability and distribution of essential commodities under the Public
Distribution System. The said Order has been amended in 2004.
2.2(b) The PDS control order 2001 promulgated by
Government of India, provides for:-
2.1.
Distinctive
Ration Cards
2.2.
Functioning of
FPS
2.3.
Distribution
2.4.
Identification
of beneficiaries
2.5.
Licensing
2.6.
Monitoring
2.7.
Grievance
Redressal
2.2.1 Provisions
for Ration Cards
1 Clause
4:The State Government shall issue distinctive ration cards to Above Poverty
Line, Below Poverty Line and Antyodaya families and shall conduct periodical
review and checking of the ration cards as per paragraph 2 of the Annexe to
this Order.
2 Para
2 of Annexe provides that State Governments shall ensure that no eligible
applicant is denied a ration card under the Public Distribution System. State
Government shall issue distinctive ration cards to APL, BPL and Antyodaya
families. The ration card holder shall be entitled to draw essential
commodities from a fair price shop on weekly basis.
3 The
designated authority shall issue a ration card within one month of the date of
receipt of the application after necessary checks and verification. State
Government shall conduct periodical checking of ration cards to weed out
ineligible and bogus ration cards and bogus units in ration cards.
4 Elimination
of bogus ration cards as well as bogus units in the ration cards shall be a
continuous exercise by the State Governments to check diversion of essential
commodities.
5 Ration
cards shall not be used as documents of identity.
2.2.2 Provisions for Functioning of FPS shops
1
Para 5(i) of Annexure to PDS
control order 2001 provides that the
essential commodities must be sold as per the entitlement of ration card
holders and at the retail issue prices fixed by the concerned State Government.
2
Para 5(ii) of
the Annexure to PDS control order 2001
provides that each FPS will display the following information on a
notice board which is to be put up at a prominent place in the Shop on a daily
basis:-
(i) List of BPL and Antodaya beneficiaries,
(ii) Entitlement of essential commodities,
(iii) Scale of issue,
(iv) Retail issue prices,
(v) Timings of opening and closing of the fair
price shop,
(vi) Stock of essential commodities received
during the month,
(vii) Opening and closing stock of essential
commodities and
(viii) The authority for redressal of
grievances/lodging complaints with respect to quality and quantity of essential
commodities under the Public Distribution System.
2.2.3
Provisions for Distribution:
(a) Clause
6 of PDS Control order provides:
(1) The
procedure for distribution of foodgrains by the Food Corporation of
(2) Fair
price shop owners shall take delivery of stocks from authorized nominees of the
State Governments to ensure that essential commodities are available at the
fair price shop within first week of the month for which the allotment is made.
(3) The
district authority entrusted with the responsibility of implementing the Public
Distribution System shall ensure that the stocks allocated to the fair price
shops are physically delivered to them by the authorized nominee within the
stipulated time.
(4) The
authority or person, who is engaged in the distribution and handling of
essential commodities under the Public Distribution System, shall not willfully
indulge in substitution or adulteration or diversion or theft of stocks from
Central godowns to fair price shop premises or at the premises of the fair
price shop.
(b) Para
4 of Annexure to the PDS Control Order provides:
(1) The
Food Corporation of India (FCI) or any other agency designated for the purpose
by the Central Government shall ensure physical delivery of foodgrains of fair
average quality to State Governments for distribution under the Public
Distribution System, as per the allocations made by the Central Government,
within two weeks of the receipt of payment from the State Governments and issue
of release orders.
(2) State
Governments shall, on getting allocation of foodgrains from the Central
Government, issue district-wise allocation orders authorizing their agencies or
nominees to draw foodgrains from the FCI within ten days of the receipt of
allocation orders made by the Government of India
(3) The
designated authority of the State Governments shall ensure delivery of one copy
of allocation order made to the fair price shop simultaneously to Gram
Panchayats or Nagar Palikas or Vigilance Committees or any other body nominated
for monitoring the functioning of the fair price shops by the concerned State
Government.
(4) Gram
Panchayats or Nagar Palikas or Vigilance Committees or any other body nominated
for monitoring the functioning of the fair price shop by State Governments
shall display the stocks of essential commodities allotted during the month to
the fair price shops on a notice board outside their office.
(5) While
making monthly allocations to the fair price shops the designated authority of
State Governments shall take into account the balance stock, if any, lying
un-distributed with the fair price shop owners for the subsequent allocations.
(6) State
Governments shall make arrangements for taking delivery of essential
commodities issued by the Central Government by their designated agencies or
nominees from the FCI depots/godowns and ensure further delivery to the fair
price shop within the first week of the month for which allocation is made.
(7) Before
making the payment to the FCI the representatives of State Governments or their
nominees and the FCI shall conduct joint inspection of the stocks of foodgrains
intended for issue to ensure that the stocks conform to the prescribed quality
specifications.
(8) The
FCI shall issue to the State Governments stack-wise sealed samples of the
stocks of foodgrains supplied to them for distribution under the Public
Distribution System at the time of dispatch.
(9) State
Governments shall exercise necessary checks to ensure that full quantity lifted
by them reaches their godowns and in turn the fair price shops.
(10) State
Governments shall ensure that stocks of essential commodities under the Public
Distribution System, as issued from the FCI godowns, are not replaced by stocks
of inferior quality during storage, transit or any other stage till delivery to
the ration card holder.
2.2.4 Provisions for Identification
Para 1 of Annexe talks of Identification of families living below the Poverty
Line:
(1) State
Governments shall formulate suitable guidelines for the purpose of identification
of families living Below the Poverty Line (BPL), including the Antyodaya
families, as per the estimates adopted by the Central Government. Care will be
taken to ensure that the families so identified are really the poorest. The
exercise of identification of BPL and Antyodaya families, wherever it has not
been done already, shall be completed within three months of the issue of this
Order.
(2) State
Governments shall get the lists of BPL and Antyodaya families reviewed every
year for the purpose of deletion of ineligible families and inclusion of
eligible families.
(3) While
undertaking the exercise of identification or review of BPL and Antyodaya
families, each State Government shall prescribe a suitable proforma to be
filled up by or on behalf of the head of a family.
(4) The
data provided in the prescribed proforma shall be verified by the authority
designated by the State Government for the purpose. The said authority shall
also certify the correctness of the information contained in the proforma.
(5) Gram
Sabhas shall finalize the list of beneficiaries belonging to BPL and Antyodaya
categories drawn up by the designated authority in respect of the area under
their respective jurisdiction.
(6) Where
there are no Gram Sabhas, the local representative bodies shall finalize the
list of beneficiaries belonging to BPL and Antyodaya categories within their
respective jurisdiction.
(7) The
designated authority of the State Government or the local representative bodies
including Gram Sabhas and Gram Panchayats which have been entrusted with the
task of identification of beneficiaries, shall verify and certify the
information in the prescribed proforma for BPL and Antyodaya families.
2.2.5
Provisions for Issue of Licence
The PDS Order, 2001, under Clause 7 read with paragraph 5 of the Annexure to the
Order lays down the procedure
for issue of licences or authorization to the fair price shops for the
distribution of essential commodities under Public Distribution System. And
duties and responsibilities of the fair price shop owners are provided.
2.2.6 Provisions
for Monitoring
The procedure for monitoring of the Public
Distribution System including the functioning of the fair price shops by the
State Governments shall be as per paragraph 6 of the Annexe to this Order.
The para 6 of the Annexure provides
1) State Governments shall ensure a proper system of
monitoring of fair price shops and prescribe model sale register, stock
register and ration card register.
(2) State Governments shall ensure regular
inspections of fair price shops not less than once in six months by the
designated authority. State Governments may issue orders specifying the
inspection schedule, list of check points and the authority responsible for
ensuring compliance with the said orders.
(3) Meetings of the Vigilance Committees on the
Public Distribution System at the State, District, Block and FPS level shall be
held on a regular basis. The date and periodicity shall be notified by State
Governments However, the periodicity shall not be less than one meeting a
quarter at all levels.
(4) State Governments shall ensure a periodic system
of reporting and the complete information in this regard shall be sent in the
prescribed form as follows:
(i) By
fair price shops to the District Authorities by the 7th of the month
(ii) By
the District Authorities to State Government by the 15th of the
month following the month for which allocation is made
(iii) By
the State Government to the Central Government by the end of the month following
the month for which allocation is made.
(5) Future allocation of foodgrains to States shall
be linked to the receipt of regular reports from the respective States and
furnishing of utilization certificates by them within a period of two months
from the month for which allocation is made.
(6) State Governments shall ensure monitoring of the
functioning of the Public Distribution System at the fair price shop level
through the computer network of the NIC installed in the District NIC centers.
For this purpose computerized codes shall be issued to each FPS in the
district.
(7) State Governments shall educate the ration card
holders regarding their rights and privileges under the Public Distribution
System by use of electronic and print media as well as display boards outside
fair price shops.
(8) State Governments shall issue and adopt the
Citizen’s Charter based on the model Citizens Charter issued by the Central
Government.
(9) The designated authority shall direct the
concerned fair price shop owner to provide relevant extracts of the documents
maintained by him on an application made by a beneficiary, on payment of a
prescribed fee.
Orders applicable in the Public Distribution system
of Jharkhand are as follows
1.
2.
2.3 THE
2.3.1 State
of
2.3.2 The
2.3.3 Authorised Persons as per 1984 Order
i.
Clause 2(c)
says, Collector includes Deputy Commissioner, Additional Collector and such
other officers, not below the Rank of SDO as may be authorized by the collector
to perform the functions and exercise the powers of the Collector.
ii.
Clause 2( i )
provides that Licensing Authority means
an officer not below the rank of SDO appointed by the State Government to
exercise the powers and perform the
duties of the Licensing Authority for different areas and under the different provisions of Bihar Trade Articles ( Licences Unification )
Order, 1984. The order of 1984 provides the role and powers of Commission and
Collectors in clause 27.
2.3.4 Redressal Mechanism (Appellate and
Revisional Powers) as per 1984 Order
The Order of 1984 also provides
for redressal mechanism for Licence of shop. If any order is made by any
officer of lower rank than the Collector appeal may lie to the Collector and if
the Order is made by the Collector appeal lies to the Commissioner. Such appeal shall be preferred within 30 days
from the date of receipt of the Order appealed against by the appellant. The
Commissioner has revisional powers and he may call for the record of any case
decided by the Collector or the Licensing Authority if he is satisfied that
Collector or the Licensing Authority
i.
has exercised a
jurisdiction not vested in him or
ii.
it has
exercised the jurisdiction vested in him or it with material irregularity.
iii.
has improperly
failed to exercise the jurisdiction vested in him or it.
Thus, the 1984 Order does not provide
redressal mechanism for the Consumer and
it only provides redressal to licencee of shop.
2.3.5 Inspection, search and seizure as per 1984
Order
Power to enter, search, inspect and seize stock is
also given in the Bihar Trade Articles (Licences Unification) Order, 1984, to
various authorities of Food and Supply Department, Executive Magistrates, Block
Development Officer.
2.4
Clause 3 says every dealer shall
before commencement of his business on any day display at a conspicuous place
near the entrance of his business premises list of prices and stocks of all
articles.Clause 4 says that Dealers shall not sell to any person any article at
a price higher than that displayed.Clause 7 provides for maintenance of Stock
Register in respect of articles mentioned in Schedule I.
2.5 ORDERS PASSED BY THE HON'BLE SUPREME COURT IN W.P. (C) NO.
196/2001
2.5.1 The Hon'ble Supreme Court by the order
dated 02.05.2003 directed as follows,
"It is necessary to issue immediate directions to
evolve a system whereby eligible BPL families, which may not be on BPL list,
are so included as also regarding the ration shops and other outlets remaining
open and giving deliveries of food-grains to those, who are on the list and
hold the requisite cards……. the respondents shall ensure that the ration shops
remain open throughout the month during fixed hours and the details of which
shall be displayed in the notice board.
To facilitate the supply of the grain, we
issue the following directions:-
(1) Licencees,
who
(a) do
not keep their shops open throughout the month during the stipulated period,
(b) fail
to provide grain to BPL families strictly at BPL rates and no higher,
(c) keep
the cards of BPL households with them,
(d) make
false entries in the BPL cards,
(e) engage
in black-marketing or siphoning away of grains to the open market and hand over
such ration shops to such other person/organizations,
shall make themselves liable for cancellation
of their licences.The concerned authorities/functionaries would not show any
laxity on the subject.
(2) Permit the BPL household to buy the
ration in installments.
(3) Wide publicity shall be given so as
to make BPL families aware of their entitlement of food-grains."
Same Order further directed that
"According to the figures supplied
by the petitioner, approximately 1.5 crore persons are eligible to get
Antyodaya Anna Yozana (AAY) Card. We direct the Government of India to place on
AAY category the following groups of persons :-
(1) Aged,
infirm, disabled, destitute men and women, pregnant and locating women,
destitute women ;
(2) widows
and other single women with no regular support;
(3) old
persons (aged 60 or above) with no regular support and no assured means of
subsistence;
(4) households
with a disabled adult and assured means of subsistence;
(5) households
where due to old age, lack of physical or mental fitness, social customs, need
to care for a disabled, or other reasons, no adult member is available to
engage in gainful employment outside the house;
(6) primitive
tribes."
2.5.2 The Hon'ble Supreme Court by its order
dated 8.5.2002 fixed the
(a)
Responsibility of Collectors.
“The CEO/Collector of all the Districts
in the States and territories shall scrutinize the action taken by all the
implementing agencies within their jurisdiction to ensure compliance with this
court's orders and report to the Chief Secretary. The responsibility for
implementation of the order of this Court shall be that of the CEO/Collector.
The Chief Secretary will ensure compliance with the
Order of this
Court.”
(b) Time of opening of FPS
“The respondents shall ensure that the
ration shops remain open throughout the month, during fixed hours, the details
of which will be displayed on the notice board.”
2.6
CONCLUSIONS
2.6.1
The State government has not issued any order as
contemplated by para 5 of the Annexure to the PDS Control order 2001 for
regulating the
2.6.2
The Bihar Trade and licensing Order 1984 only
governs the issuance renewal, suspension, cancellation of Licence. The Order,
1984 is woefully inadequate as it does not contain provisions with respect to
the following aspects
i.
Identification
of beneficiaries
ii.
Distinctive
Ration Cards to APL/
iii.
Distinctive
Ration Cards to APL/ BPL/Antodaya and its periodical review
iv.
Scale of Issue
and Issue Price
v.
Distribution of
Foodgrains
vi.
Monitoring
of Public Distribution system
vii.
Grievance
Redressal mechanism for beneficiaries.
Hence, there is a need to issue a
separate PDS control Order for the State to regulate the sale and distribution
of essential commodities.
*******
Chapter 3
WHOLESALE DISTRIBUTION
3.1
INTRODUCTION
3.1.1
PDS is operated
under the joint responsibility of the Central and the State Governments. The
Central Government has taken the responsibility for procurement, storage,
transportation and bulk allocation of foodgrains, Central Government is responsible for
procurement, storage, transportation upto principal centres of FCI, allocation
to State and
3.1.2
For the purpose
of distribution, State/UT Governments have constituted separate Corporations
which are Government Companies under the Companies Act 1956. There is no separate Corporation for the
State of
3.2 BIHAR STATE
FOOD AND CIVIL CORPORATION LIMITED (BSFC)
3.2.1 Bihar State Food and Civil Supplies
Corporation has been established on 2nd April 1973 and is registered under
Companies Act 1956. This Corporation acts as the agent of the States
Governments of Bihar and Jharkhand in matters of procurement, transportation
and handling, storage and distribution of food grains to targeted PDS dealers
and other Govt. agencies.
3.2.2
Organizational
Set up.
The Management of the company is vested in a Board of
Directors, all appointed/ nominated by the Bihar State Government. Managing Director of the Corporation is the Highest
Official and there are three officers under him Chief of Administration, Chief
Procurement and Chief Finance. Chief Administration looks after perssonnel
department, Vigilance and Administration. Chief Procurement looks after
Procurement, storage and distribution and is an intermediary between FCI and
Food and Supply Department of the State.
3.2.3
Hierarchy
at District office of the BSFC
District Manager
Accounts Officer
Godown Manager
3.2.4
Main
activities of the Corporation are follows
(i) Procurement
of food grains from FCI under various Central Govt. Schemes like TPDS (BPL,
APL, Antyodaya Anna Yojana), Annapurna, SGRY, Food For Work, MDM, Relief etc.
their storage, transportation, handling and distribution to the Govt. agencies
and Targeted PDS dealers in the State of Bihar and Jharkhand.
(ii) The
Corporation also participates in the Procurement drive of the State Govt. of
Bihar for purchase of Wheat, Rice and Paddy in the open market in view of the
Price Support Scheme to the farmers.
3.2.5
Bihar State
Food & Civil Supplies Corporation continues to operate in the States of
Bihar and Jharkhand in terms of instructions contained in the order No.1202/25/2004-SR
Govt. of India, Ministry of Home Affairs,
3.2.6
BSFC has 10
offices of BSFC in the State of
3.2.7
In the State of
3.2.8
The company, being a procurement, storage and distribution
agency of the State Government, procures foodgrains from FCI against monthly/
yearly allotments made by the Central/State Government under various schemes.
The Company through its District offices deposits the cost of foodgrains to FCI
and obtains Release Orders (RO) from them for lifting and distribution to FPS
dealers.
3.2.9
Committee asked the Managing Director of BSFC to
provide the Profit and Loss A/c and Balance sheet of Jharkhand BSFC for last 3
years to understand the working of the Corporation. But instead of this, he has
provided the Committee with the combined financial details of Corporation for
the State of
3.2.10
However,
Committee perused the two Audit Report of Comptroller and Auditor General of
a)
Report for the
year 2005-2006 of State of
b)
Audit Report
(Civil and Commercial), of State of
3.2.11 The report of the Comptroller and Auditor
General for the period ending 31-3-2006 for State of
A.
Lifting/ offtake:
In the State of Jharkhand out of the total allotment by GOI, only 42-77% of wheat and 10-33% of
rice were lifted under BPL, while 35to 92% of wheat and 35-88% of rice were
lifted under AAY scheme during the years 2001-2006. During 2001-2006, as
against the allotment of 16.79 lakh MT of wheat and 20.42 lakh MT of rice under
BPL category by GOI, BSFC had lifted and distributed 9.88 lakh MT wheat and
5.08 lakh MT or rice respectively. In case of AAY category, as against the
allotment of 4.32 lakh MT of wheat and 4.75 lakh MT of rice BSFC had lifted and
distributed 3.42 lakh MT of wheat and 3.70 lakh MT of rice respectively during
2001-2006.The Audit report of BSFC says that failure of the BSFC to lift the
quantity available with FCI within the scheduled time due to not making
available the required number of trucks and delay in obtaining ROs had also
contributed towards low lifting.
B.
Diversion:
The BSFC had diverted AAY Rice and wheat to APL scheme and to BPL
scheme. Total foodgrains diverted from AAY to BPL scheme was worked out to be
1683.4MT of wheat and 1673 MT of rice. Since this diversion was from foodgrains
attracting higher subsidy (AAY) to lower subsidy (BPL), BSFC unduly earned
Rs.80.53 lakhs in Jharkhand.
By diverting foodgrains of AAY, Annapurna, MDM, SGRY to BPL and APL
scheme in both state of
BSFC diverted BPL foodgrain worth Rs. 89 lakh and AAY foodgrain worth
Rs.5.34 lakh belonging to district Dumka to another 2 districts Deoghar and
Jamtara , which was in addition to the foodgrains allotted to those two
districts. Consequent to this diversion not only the programme implementation
suffered in Dumka, misappropriation also could not be ruled out.
C.
Backlog:
The Company had an outstanding balance of Rs.82.96 crore (as on 31st
March 2005) received from FPS dealers towards cost of foodgrains which had not
been delivered to them under BPL and AAY schemes . As a result the
beneficiaries were deprived of the supply of foodgrains for the relevant
months. The Company had not adopted any
mechanism to review old deposits lying with it , for taking action for refund/
adjustment.
D.
Transportation:
The transportation and handling of foodgrains from FCI godowns to the
Company's godowns is done by Transport agents (TAs) appointed by the Company on
annual rate contract basis. TAs are appointed through open tenders with a
provision to extend the contract for the next two years without calling fresh
tenders Often there were delays in finalising the rate contract with the TAs.
In the absence of a rate contract, the transportation was got done by Godown Managers
of the Company by hiring trucks from the open market, classifying it as
"Departmental Transporting". It was noticed during audit that there
was lack of transparency in the engagement of TAs and competitive rates were
not obtained by the Company indicating deficient planning and monitoring by the
higher Management.The Foodgrains allotted against various schemes are required
to be lifted by the Company within a prescribed time period. As per the
agreement, the TAs are required to provide sufficient number of trucks to lift
the foodgrains for which FCI issues ROs. It was, however, noticed that
Transportors failed to provide the required number of trucks as a result of
which allotment of 77,000 quintals of foodgrains lapsed. Undue benefit of Rs
2.46 crore was extended to Bihar State Food & Civil Supplies Corporation
due to fixing of excess transportation and handling charges by Rs 1.85 per
quintal on wheat during 2001-06.
E.
Defalcation/ theft of foodgrains
Audit scrutiny revealed that non-observance of the prescribed internal
controls which stipulate monthly submission of stock statement by the Godown
Managers to the District office, reconciliation of the Store Issue Orders (SIO)
with the balance stock available in the godowns, surprise physical verification
of stocks by the District Managers, periodical verification of stocks by the
district supply officers etc. had facilitated the defalcation/theft by the
employees, of foodgrains worth 26.20
Lakh in District Hazaribagh. Foodgrains
valued at Rs 1.22 crore were diverted in totality by BSFC officials. The
Management stated (September 2006) that necessary criminal and civil suits had
been filed against the officials.
The above observations clearly show that the Bihar State Food and Civil
Supplies Corporation is a thoroughly mis- managed company, indulging all
possible malpractices, including diversion of stocks, defalcation.
3.3 BIHAR HIGH COURT JUDGMENT FOR
SEPARATE STATE FOOD CORPORATION
3.3.1 Bihar State Food & Civil Supplies
Corporation Ltd. (Corporation) was looking after the distribution of PDS food
grains for whole of the State of
3.3.2 On April 20, 2006 a notice was issued in
contempt petition and the High Court
stayed the order dated April 15, 2006 of the
3.3.3 It is not necessary to narrate further
history of litigation however it is pertinent to mention that under the orders
of the High Court, Secretaries of the two Governments met and arrived at an
arrangement subject to approval by the Central Government. When the single Judge of the High Court
stayed the arrangement till the arrangement was approved by the Central Govt.,
Corporation went in appeal by filing LPA.
The impugned order was modified and status quo was directed to be
maintained till the approval of the Central Govt. Central Govt. by its order dated 21.12.2006
approved the arrangement earlier arrived at by the Secretaries of the two
Governments. When the matter was finally
taken up to consider the writ petition the Court observed that
“in that view of the matter there
is no subsisting order of stay in the
matter, as such it is desirable that the
final order/notification to be issued in
this respect within two months and the assets and liabilities in the ratio
3:1 as mutually decided be
apportioned. The
So far lifting of the
food grains for A.P.L./B.P.L./Antyodaya schemes by the
The impugned orders are
quashed. The respondents are now free to
pass similar orders in this regard after issuance of final notification within
two months.”
3.3.4
The Committee, during its visit to Jharkhand found that
there is no separate Food Corporation so far constituted by the
3.4. MALADIES
AFFECTING THE FUNCTIONING OF BSFC
1 Management
2 Storage Conditions
3 Backlog
4 Payment and money of FPS owner
5 Vigilance
6 No Inspections by FCI
3.4.1 Management
The BSFC is not managing
the godowns properly. The delayed allocation, improper maintenance of record, improper
storage and transportation system of BSFC clearly shows mismanagement and lack
of Administration. The BSFC is not
following the standards of storage system. The condition of BSFC godowns shows
that higher officials are not supervising the
functioning of godowns properly. Delay in transportation or in issuance
of stock issue order shows lack of coordination between various concerned
authorities which results in disruption of supply chain. Mr. Rana Awdhesh, MD
BSFC stated that there is need to improve supply chain management.
3.4.2 Conditions of
Godowns
3.4.2.1 The condition of Godowns is also not good
in Jharkhand. The same was observed by
the Committee during its visit and inspection of the godowns at Kudru (
3.4.2.2 Weighment: Committee
inspected godown no. 3. The said Godown had a simple manual weighing Scale (Taraju)
in which one bag at a time can be weighed. It’s beyond comprehension that all
the bags which come to godown are weighed on that weighing machine Chief
Procurement Officer of BSFC informed that none of the BSFC godown has
electronic weighing systems.
3.4.2.3 Electricity: The said godown
is built in a very big area. It remains dark even in day time as the sunlight
from big doors is the only source of light. The Godown Manager informed the
Committee members there is no electric connection in all three godowns at
Kudru. Record is maintained in Stock registers manually. Seeing the Condition
of this godown, Computerization of PDS system seems a far fetched goal.
3.4.2.4 Grievance of
Labours: The Prabhu Nath Singh, Godown Manager who Manages godown no. 1 and 3 informed
that about 150 truck of foodgrain come in godown every month. One truck
contains 120 quintal thus, it becomes 18000 Quintal a month. Committee found
that lots of labours were present in the godown, when asked they informed that
there are total 72 labours on contractual basis which are hired by the
transporter who brings foodgrains from FCI to BSFC godown. These 72 labours do
loading/ unloading work at BSFC godown.
3.4.2.5 Empty bags: Committee found
lots of empty bags lying in the godown no. 3.
Committee member asked the Godown Manager about those bags and he said
that often many bags contain lesser quantity of grains so while distributing
the foodgrains to FPS dealers they fill those bags with full 50 kg and
therefore in this process many bags are left as empty bags. When asked about how
many numbers of bags are lying empty in godown he said about 700-800 empty bags
are lying in godown no. 3 and about 1000 empty bags are lying in godown no. 1.
3.4.2.6 Undistributed Stock: The BPL rice for
the month of October has been issued to FPS owners and food grains for the
month of November and December 08 has not been distributed till 23rd
December 08. The BPL stock for November and December’08 was lying in the godown
and the FPS owners had also deposited the money but stock has not been distributed
to FPS owners. Godown Manager that it is not distributed as he has not received
the Stock Issue Order.
3.4.2.7 Sampling: No Sample of foodgrains received
and to be issued was present in the Godown. Godown Manager informed they don’t
get any sample from FCI. Further no sample is given to the FPS owners by them.
3.4.2.8 Days when grain
was issued: As per Issue Registers in the month of November food
grains were issued from 1st November to 21st November 2008. Godown manager further informed
that there are 140 FPS dealers attached to godown no 3.
3.4.2.8 Stock of Backlog
allocation not issued: While going through stock register and issue register
it was observed by the Committee that in the month of November, 2008 the Godown
manager received more quantity of food grains and issued the less quantity. Godown
manager Prabhu Nath Singh said that received quantity is more because he
received the extra food grains which is from backlog allocation. He said he has
allocated less as the quantity allocated is equal to the quantity of
entitlement of the FPS owners. The system of backlog is a sure way of
ultimately diverting the foodgrain. During the public meetings it was revealed
that the quota for the months of February, March and July had been lapsed.[11]
There was no explanation as to where this quota of foodgrain had been utilized.
3.4.2.10 Rotten grains
Stock: In the Godown no.3 at Kudru block,
3.4.2.11 Storage System: There was no
proper storage system in the godown. There were no methods of disinfecting the
food grains. Stocks of food grains were lying in the godown in rotten condition
when millions of people are living below poverty line who do not get their full
entitlement of foodgrains. In order to combat food insecurity it is essential
to store the food grains properly and distribute the same timely. Both the
factors appeared to be totally ignored in the PDS in the State of
3.4.3 Backlog
1 Backlog in allocation to FPS
dealers is the major problem in Jharkhand. The food grain is not issued to
dealers in time and there is always delay / backlog in allocation of foodgrains
to FPS owners. One of the main reasons for this was negligence by the BSFC in
not lifting the full quantity of food grain allocated from FCI[12].
The food grains issued to BSFC lapses as same is not issued to dealers and it
is not known what happens to the foodgrains stock which comes to BSFC as
backlog allocation and as the same is not issued to FPS dealers and is shown as
lapsed Allocation
2 Mr. R.N. Lal, Chief of Procurement,
BSFC informed the committee that one of the reasons for delay in the issuance
of food grain to the FPS owners was that FPS dealers have to first deposit their
bank drafts to marketing officer/supply head, then it reaches to SFC Godown in
charge. All this process almost takes more than 1 week. There is no system of
direct deposit of Bank Draft. He also informed that FPS dealers generally
deposit the bank draft on time.
3 Managing Director, BSFC informed
the Committee that one reason of backlog
is that there is a major problem of Labour for loading and unloading of
bags of foodgrains as the labour have a
4 Another reason stated by Managing
Director for backlog is that there is need for sufficient storage capacity; due
to which there is delay in lifting and distribution of food grains. He informed
the Committee that BSFC is planning PPP system that is ‘public-private-partnership’
system for building new Godowns for storage of food grains at Block Level with
storage capacity of 500 Mt and at District Level with storage capacity of 1000
Mt whereby land and building of private persons can be hired by BFSC for using
it as godown. Under this scheme, BSFC will help the private individual in
getting loan from the bank for construction of Storage Godown on his own land
and will hire these godowns for specific period of time and pay the installment
of loan on behalf of the owner of the land. This will help both the sides. He
said that there is always delay in supply of food grains from FCI and he
suggested for rapidity in supply and lifting.
5 District Collector, Ramgarh, also
said that FCI does not provide grain on time to BSFC which resulted in backlog
which further resulted in non distribution and diversion.
6 Shri Ram Naresh Singh, President of
FPS owners Association, informed the Committee that allocation of foodgrains is
not in time and is always delayed by 2-3 months. He said Backlog in allocation
is common and usual problem in Jharkhand.
7 The Jharkhand State government had
planned to start a new scheme from November’ 08 whereby wheat was to be
distributed at the rate of Rs 2 per kg and rice @ Rs 3 per kg. However, this
scheme has not come into operation. Due to the new rates of distribution of
food grains the supply of food grains has been delayed as there is confusion
about how to adjust the money already received from the FPS owners (FPS owners
deposit the money for the monthly allocation by 15th day of a
month). The government officials took the plea that delay in issue of stock to
FPS is because of Rs 2 scheme, however the plea is not tenable as the delays
were because of untimely lifting from FCI, delayed release orders or stock
issue orders. It was more because of
mal-administration of the functioning.
This is also clear from the information gathered by the Kudru Godown ,Ranchi
where BPL rice only upto the month of October has been issued to FPS owners and
was not issued for the month of November
and December 08 till 23rd Day of December i.e the day of Committee’s
Visit. BPL stock for November and December’08 was lying in the godown but was
not distributed to FPS owners, though they had deposited the money in time. On
asking why the same is not distributed Godown Manager said that its not
distributed as they have not received the Release Order from BSFC Regional
Office.
8 Mrs. Manju Kumari , Marketing
Officer, Ranchi said that it is never clear
how much stock BSFC lifts from FCI and she suggested that there should
be transparency about the quantity of stock lifted from FCI and time of
lifting. She also suggested that if the backlog problem is solved PDS system
will improve to large extent as the backlog allocation is the major problem in
the system.
3.4.4 Payment
through Bank draft
The dealers have to deposit the
money by the 15th day of the preceding month prior to the month of
allocation. The quota is distributed to them
after 2-4 months .Thus the money of the FPS dealers is blocked and there is
loss of interest to the FPS dealers.
3.4.5
Vigilance Squad of BSFC
Chief Procurement
officer of BSFC informed the committee that BSFC has its own flying squad and
vigilance department which conduct periodically surprise inspections in the
godowns of the BSFC but no document or Inspection report was shown to the
Committee. The Conditions of the Godown inspected by the committee also does
not suggest that any inspection was ever done
3.4.6 Inspections
by FCI Officials
The Government of India decided that
a system of regular inspection be put up in place not only for FCI
godowns but also for State Government/Authorised wholesale Godowns and thus issued
instructions to FCI vide letter dated 24th
October 2007. In pursuance to that FCI
issued directions to all Regional General Managers vide Letter dated 31st
October 2007 to inspect State Government /Authorised wholsale godowns and to submit detailed
report to the Headquarter and to State Government. Committee inquired from the
FCI officials during meeting dated 21st December 08 whether they
have conducted such inspections. Committee was informed that no such inspection
has been conducted by the FCI officials in State of
3.4.7 Public
Grievances
[13]
Committee was informed during the Annagada Public
Hearing on 23rd December 08 held at Block Annagada,
a)
That rotten
grains and good grains are lying in the godown together and if the FPS owners
do not pay Rs. 10 per bag to Godown Manager he gives rotten grains to him.
b)
So far as
Quantity is concerned Godown manager always supplies the grains by taking
average weight of bag as 52 kg where as the average weight of a bag is only 45
kg. Thus, there is a shortage of 7 kg per bag.
c)
Bihar State
Food Corporation shows backlog allocation and there is always delay of 2-4
months. At some places even Antodaya
grains are not given in time and there is delay of about 3-4 months.
d)
Three to four
months money is paid by FPS owner and it gets blocked but foodgrains are not
allotted in time. FPS owners pay money out of their pocket to deposit draft in
time.
e)
If this backlog
problem is cured and corrected 80% problem can be solved and food security can be ensured
to a large extent.
f)
It was also suggested
by him that they should be allowed to deposit money only when grain is
available at the BSFC godown.
3.5 CONCLUSION
3.5.1 There is an acute shortage of storage
capacity in the State of
3.5.2 The problem of backlog is a major problem
which not only delays the issuance of foodgrain to FPS but increases the
chances of diversion. Neither the Food and Supply officers nor the FPS owners
are aware how much stock is lifted from FCI. There should be transparency about
the lifting date and quantity of stock.
3.5.3 The capital of FPS owners gets blocked
for three to four months as foodgrains are not issued in time. FPS owners pay
money out of their pocket to deposit draft in time. The one reason for delay in
issuance was that Release Orders are not given from BSFC Regional office to
Godown. Thus, it is suggested that they should be allowed to deposit money only
when grain is available for lifting at the BSFC godown. It is also suggested
that a system of e-banking should be adopted for depositing the money by FPS
Owners. The amounts so received through
E-banking from the Fair Price Shops shall also be verified and authenticated by
Food and Civil Supply Department and FCI online to ensure that the amounts
remitted correspond to the allocation of Fair Price Shops. For this purpose, a
computerized system should be in place to ensure connectivity between these
three agencies so that remittances can be properly monitored at all ends.
3.5.4 The conditions of Godowns is deplorable and
the storage system is very badly managed due to which the foodgrains quality
detoriates. A proper scientific storage system should be adopted and grains
should be issued in time so that quality does not detoriate by time.
3.5.5 The BSFC godowns have no electric
connections. The godowns need to be electrified urgently.
3.5.6 All the State Food Corporations Godowns in
3.5.7 There is no system of maintaing or issuing
samples in the BSFC godowns. It is the duty of the State to ensure that the
stocks of food grain as issued from the FCI godowns, are not replaced by stocks
of inferior quality during storage, transit or any other stage till delivery to
the ration card holder. For this purpose FCI issues stock wise sealed samples
of stocks of food grain supplied by them. BSFC should ensure that the samples are
maintained in their godowns. They should also issue stock wise sealed samples to the retailers
which should be available at the FPS for inspection by enforcement squads,
Viglance Committee or the consumers.
****
Chapter 4
DIVERSION OF FOODGRAINS
4.1 Food grain is procured for the Public
Distribution System on behalf of the Central Government by the Food Corporation
of India (FCI). State of
4.2 Diversion of food grain takes place at
every level of the system. The different ways in which diversion takes place
would show that Government Officials,
Storage Agents, Godown Keepers, Transporters and retailers are all
involved in the diversion of food grain in some manner or the other. The malady
of diversion is prevalent in the system in such large scale that it has become
a menace and threat to the system.
4.3 The first and foremost reason for
diversion is the difference in the price of TPDS grain and market rate. This
serves as an incentive for the unscrupulous persons connected with the
implementation of the system to connive with the traders to divert the TPDS
food grain into open market. The difference in price is also an incentive for
people who are not otherwise eligible under the scheme to get the benefit of
the lesser rates of grain.
4.4 The second reason for diversion is the
lack of any system of accounting for the grain allocated under the system.
Ideally there should be a system by which the grain allocated to the State can
be equated with the grain distributed to the beneficiaries. Since the scale of
distribution and the number of beneficiaries is very large this can not be
achieved manually. Thus there is need for complete automation and
computerization of the Public Distribution System.
4.5 The third reason for is that the
functions of implementation, enforcement and vigilance are not clearly
demarcated and implemented.
4.6 There are two ways in which diversion
takes place. Firstly by selling the TPDS grain in the open market, and secondly
by substituting the TPDS grain by grain of inferior quality.
4.7 The Targeted Public Distribution System
when introduced was intended to benefit about 6 crore poor families for whom a
quantity of about 72 lakh tones of food grains was earmarked annually. Over and
above the TDPS allocation, additional allocation of 103 lack tones of food
grain was earmarked annually and provided to the States as ‘transitory
allocation’. This was intended for continuation of benefit of subsidized food
grains to the population Above Poverty Line (APL) as any sudden withdrawal of
benefits existing under PDS from them was not considered desirable. The
allocation for APL has continued till date and has proved to be one of the
greatest sources of diversion. At present the allocation for the APL to any
State is 14.6% of its APL requirement. It is common knowledge that most APL
cardholders do not get any food grains under the PDS. Rest do not bother to
draw their entitlement. Since full quota is not being allotted for the APL most
of the States have adopted the ‘first come first serve’ principal. This enables
the FPS dealer to put off any card holder on the plea that the APL stock has
been exhausted and divert most of the stock meant for APL.
4.8 Bogus ration cards come into existence
in several ways.Some of the ways are enumerated below only as an example. The
list is not exhaustive.
1.
By using the
cards of the people who are dead or have changed residence.
2.
Obtaining a
ration card at temporary place of residence or by showing residence at some
place falsely.
3.
Breaking up the
family into smaller units
4.
Duplicate
ration cards issued in the name of
persons who are already issued cards.
5.
Ration cards
issued in fake names and at fake addressees.
4.9 A
suggestion was received by the Committee to link the issue of ration cards with
the voters list. This measure may help in reducing the bogus cards only to some
extent. The correctness of the voters list itself can not be vouched for as the
incidences of having bogus voters in the voters list is same if not more than
the incidence of bogus ration cards. Issue of ration cards to the intended
beneficiaries is a process which requires proper care and scrutiny by the field
staff. State Governments should lay down strict guidelines for issue of ration
cards and the officials responsible for issue of ration cards should be made
accountable for any bogus card found in their jurisdiction. The Central
Government has sponsored the Haryana Government and Chandigarh Administration
to start a computerization project which includes introduction of smart cards
with the biometrics of the card holder and his family members. This Committee
has recommended computerization of the TPDS in the report relating to
4.10 This Committee in its
4.11 In
the State of
4.12 Foodgrains are packed in Jute bags. Bags
contain mark of FCI with logo and stiching is done by using thread. The jute
bags are good to hold the weight but it is common practice during handling,
loading /unloading that labour use iron hooks to lift bags. The hook is pricked
in the bag and bag gets damaged and so there is lots of leakage of foodgrain during
the handling.
4.13 Improper weighing methods is another
aspect which needs attention. It was informed to the Committee that except for
some big depots, FCI uses beam scale for weighment which seriously hampers
delivery schedules.
4.14 The Committee was further informed that
Weigh-bridges are not maintained properly. It was informed that there were
frequent break-down of these weigh-bridges, resulting in stoppage of issue of
food grain.[16]
4.15 The State Food Corporations Godowns in
4.16 BSFC
diverted foodgrains of District Dumka worth
Rs. 89 lakhs of BPL category and AAY foodgrain worth Rs.5.34 lakh to districts
Deoghar and Jamtara ,which was in addition to the foodgrains already
allotted to those two districts. Consequent to this diversion not only
the programme implementation suffered in Dumka, misappropriation also could not
be ruled out.[17]
4.17 One
more peculiar mode of diversion in Jharkhand is backlog. This can be easily
inferred by the following examples. In West Singhbhum and Dumka 44.887 quintals
of foodgrains worth Rs. 2.33 crore (at BPL rate ) were not issued to FPSs
between March and August’ 05 . Reasons for this backlog were stated to be
irregular supply of foodgrains by FCI. Consequent to this backlog, BPL
beneficiaries were not distributed foodgrains on time and made to take avoidable
recourse to purchase from the market at higher prices. In respect of AAY benefifiaries foodgrains
worth Rs.1.42 crore were not issued to FPS between march and August 2005. Since the AAY beneficiaries do not have the
purchasing power to lift the backlog after six months in one go, the
possibility of foodgrains having been diverted and misappropriation of prices
was strong[18]
4.18 Irregular
delivery of foodgrains to FPS owners, improper weighment at godown during
issuance to FPS owners is another aspect which needs proper consideration. The
FPS Owners gets almost 7 kg less quantity of food grains per bag from BSFC
Godowns, which ultimately results in allocation of lesser quantity to
beneficiaries. Allocation of lesser quantity of foodgrains per bag affects the profit of FPS. To do away such
malpractices foodgrains can be packed in smaller bags of 5 or 10 kg so that PDS
commodity be supplied in pre-packed
small bags to the consumer. Poor packaging is major factor which leaves scope for diversion of foodgrains.
Central Government and State Government should ensure better packaging of
commodities.
4.19 The
general awareness of the beneficiaries, high literacy and strong grass root
level organisation (PRI) and strong vigilance Committee are the important
factors to reduce leakages. Strong Political commitment and careful monitoring
by the bureaucracy are the key elements for successful PDS. Leakages happen due
to wrong identification, theft and diversion of grain by officials involved in
distribution system. It requires strong
political commitment and participation of the people in delivery process. The
nexus between officials, the mafia and ration shop dealers must be broken in
order to reduce leakages. Monitoring and accountability of TPDS can be improved
by automation and computerisation of the PDS system. TPDS needs to be
strengthened by means of the effective use of IT including introduction of
unique biometric smart cards.
4.20 In
its Eleventh Five Year Plan, Planning Commission has introduced new scheme to
curb leakages/diversion of foodgrains. The scheme aims at taking effective
measures to curb diversion and leakages through Global Positioning System,
Radio Frequency Identification Device, etc.[19]
4.21 The retailers also indulge in diversion.
APL food grain can be easily diverted by them as already shown above. They also
use bogus ration cards for diversion. Besides this the committee received
complaints showing that the FPS dealers retain the ration cards of the poor
people and indulge in short weighing. As a matter of fact diversion at any
stage has to be ultimately accounted for against some ration card. This makes
the FPS licencee an accessory to all diversion done at any level and provides
scope for him to indulge in diversion on his own.
4.22 The weighing systems at different levels
also provide large scope for diversion. The Committee found that that at most
places manual weighing scales of very small capacities are used.
4.23 There are provisions in the PDS Control
Order, 2001 regarding quality Control. It is provided that the State
Governments shall make arrangements for taking delivery of essential
commodities issued by the Central Government by their designated agencies or
nominees from the FCI
4.24 Depots/godowns and ensure further
delivery to the fair price shop within the first week of the month for which
allocation is made. Before making the payment to the FCI the representatives of
State Governments or their nominees and the FCI shall conduct joint inspection
of the stocks of foodgrains intended for issue to ensure that the stocks
conform to the prescribed quality specifications. The FCI shall issue to the
State Governments stack-wise sealed samples of the stocks of foodgrains
supplied to them for distribution under the Public Distribution System at the
time of dispatch. State Governments shall exercise necessary checks to ensure
that full quantity lifted by them reaches their godowns and in turn the fair
price shops. State Governments shall ensure that stocks of essential
commodities under the Public Distribution System, as issued from the FCI
godowns, are not replaced by stocks of inferior quality during storage, transit
or any other stage till delivery to the ration card holder.
4.25 The Committee found that there was no
system of quality control in any state. No samples were found even at the whole
sale distribution points. No samples were supplied to the retailers. There was
no check on quality of grain being supplied to the beneficiaries. The Committee
found insect infested grain at one of the Storage Agents in Orrissa and rotten
grain lying in the godown of BSFC in Jharkhand.
4.26 It is suggested that there should be
complete automation of weighing systems at all levels. Weigh Bridges should be
used at all FCI and whole sale distribution points. These weigh Bridges should
be connected to computer systems to generate weight check memos automatically.
Stock inventories should also be automatically generated. The system of
sampling should be strictly observed. The State Government has to obtain stack
wise samples from the FCI after a joint inspection of the grain. The whole sail
distribution point must issue samples to the retailers to show the quality of
grain supplied. The retailer must display the sample at his FPS shop so that
the quality can be checked by the officials, vigilance machinery, enforcement
machinery and the consumer.
4.27 The
committee also learnt that at every stage of storage and transportation some
pilferage takes place from the jute bags. It was shown to the committee how
easy it is to poke a jute bag to take out grain from it and then close the
opening created by the poker. A jute bag received from the FCI was found to
contain an average weight of 48.5 Kg. The same bag is reduced to about 45-46 kg
at the whole sale distribution point.
4.28 During
the Committee’s visit to
4.29 It is felt that in case TPDS food grain
is packed in non pilferable, tamper proof bags of 10kg and 5 kg the same can be
delivered to the beneficiary in sealed packing.
This measure along with automation in weighing and use of computerization
and smart cards would go a long way in eliminating or at least reducing
pilferage. It would also ensure a more hygienic handling of food grain and help
in ensuring that the food grain of proper quality reaches the beneficiary.
4.30 The
Committee feels that diversion of PDS food grain can be largely curbed by use
of information and communication technology (ICT) based solutions. Suggestions
in this regard have been given in the recommendations made by this Committee.
*******
Chapter 5
TRANSPORTATION
5.1.
The Transportation and handling of foodgrains from FCI
godowns to the BSFC’s godowns is done by the Transport
agents appointed by the Company on annual rate contract basis. BSFC has their
own contract with the private transporters. Transportation charges from FCI
godown to BSFC godown are borne by BSFC. For transportation, tenders are
floated and benchmark rates are fixed and if any tender contains a rate below
that, it is not accepted. The labour engaged for loading unloading are
contractual labour is hired by transporters. One labourer gets Rs 1.33 per bag
for unloading and stocking it in godown. The present charges were fixed in the
year 1973 and the same have not been revised since then.
5.2.
During transportation of food grain from FCI to BSFC
Godowns, there are chances of diversion as no officer of BSFC accompanies the
truck and BSFC chief Procurement officer Mr. Lal informed the Committee that
they have found some cases of diversion during transportation.
5.3.
Committee visited the FCI godown and inspected document
pertaining to the month of November’ 2008 and found that stock was issued on 21
days in that month. On 20th November’08 11 truck food grains were loaded and
issued to BSFC On 21st 7
trucks, on 22nd November 08 4 trucks and on 24th
November’08 18 trucks food grains were loaded for BSFC.
5.4. The Marketing officer in Ranchi Mrs. Manju Kumari, informed the Committee that the number of trucks which ne