2011 (11) TMI 856
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....mon questions of law and therefore are being decided finally by this Order. The third writ petition; namely, W.P. No. 2647 (MB) of 2011 is however specific to district Pilibhit with slightly different prayer. The matter concerns the implementation of the National Rural Health Mission (NRHM) in the State of Uttar Pradesh. Gross abuse and misappropriation of NRHM funds by the State functionaries in a planned and concerted manner is alleged. Inquiry by the Central Bureau of Investigation (CBI) has been prayed for in the affairs of the Department of Health & Family Welfare, Government of Uttar Pradesh. During the course of hearing it was urged that CBI be directed to conduct preliminary enquiry into the matter from the financial year 2005-06. The Central Government has also specifically pleaded and pressed for CBI enquiry 2. Intervention of CBI to conduct an enquiry in the whole State cannot be directed at the instance of bald allegations or public interest litigations or writ petitions preferred with private vendetta. The law in this regard has been succinctly put by the Apex Court in Vishwanath Chaturvedi (3) v. Union of India, (2007) 4 SCC 380 holding that the ultimate test for ma....
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....h & Family Welfare were two separate departments in Uttar Pradesh; they were therefore merged under the directives of the Central Government. Merger of the two departments was a precondition contingent to the execution of the MoU. 5. The Society's primary responsibility, inter alia, is to receive, manage (including disbursement of funds to implementation agencies such as Directorate, District Societies, NGOs etc.) and account the funds received from the MoH&FW. The Governing Body of the Society is vested with full control of the affairs of the Society whereas the Executive Committee, Programme Committees and such other committees constituted by the Governing Body serve as its implementation agency. 6. The Chief Secretary is the Chairman of the Governing Body. The body is vested with the power to monitor the financial position of the Society to ensure smooth income flow and review the annual audited accounts and is required to convene meeting at least once every six months. Besides considering the annual budget and annual action plan for the Mission, the Governing Body evaluates at its annual meeting (a) the income and expenditure account and the balance sheet for the past yea....
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....ordance with procedure as recommended by the Government of India or Government of U.P. 12. On similar lines, the District Health Mission, District Health Society and Hospital Management Societies known as "Rogi Kalyan Samiti" were contemplated by series of Government Orders dated 16.11.2006 annexed to the MoU. The Minister-in-Charge of the District was the Chairperson of the District Health Mission. The District Magistrate served as Coordinator of the District Health Mission and Chairperson of the District Health Society. Whereas, the Chief Medical Officer of the District held the office of Member Secretary in the District Health Mission, Coordinator in the District Health Society and Chairperson in the "Rogi Kalyan Samiti". 13. The funds made available for the Mission were subject to audit of the State and District societies organised by the State within six months of the close of every financial year. Thereafter, the State Government would prepare and submit a consolidated statement of expenditure, including the interest that may have accrued. Also such funds routed vide the MoU were liable to statutory audit by the Comptroller and Auditor General of India (CAG). Thus, it is w....
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....under the Chairmanship of Director General, Family Welfare by order of the Government without any reasonable basis. The Central Government on 28.7.2010 through its D.O. letter objected to the bifurcation of the Department of Health & Family Welfare stating the action of the State Government not to be in the interest of the Mission and requested the State Government to reconsider the aforesaid bifurcation. By the same letter, the State Government was also apprised of the fact that no full time Mission Director had been appointed which was detrimental to the implementation of the Mission in a big state as U.P. 16. From the period of inception of the program in the State of U.P., it is said that the Central Government has released to the State of U.P. grants amounting to Rs. 8579.38 crore but the Governing Body of the State Health Society has all this time met only twice i.e. on 25.1.2008 and 25.7.2008 until 15.5.2011. All decisions in its place, administrative or otherwise, were instead taken by the Executive Council of the State Health Society that did meet occasionally in the absence of a full-time Mission Director. No full time Mission Director was appointed for almost five years....
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....istrict Project Officer as Chief Medical Officer/Deputy Chief Medical Officer (Family Welfare). Meanwhile, the MoH&FW vide Order dated 15.9.2011 directed the States to constitute District Vigilance and Monitoring Committee in each district to be headed by the local Member of Parliament and comprising members of local government and local representatives to monitor the program. A reminder was also sent to the State of U.P. vide D.O. letter dated 13.6.2011. However, nothing appears to have been done. 19. Pointing out the irregularities in purchasing the medical kits, medicines, equipment and other articles, the petitioners placed before us that all such work were routed through government corporations like U.P. Project Corporation Ltd. (U.P.P.C.L.), U.P. Processing & Construction Co-operative Federation Ltd. (PACCFED), Construction and Design Services (CDS), U.P. Jal Nigam, Uttar Pradesh Labour and Construction Cooperative Association Ltd. (LACCPED) and U.P. Small Scale Industries Corporation (U.P.S.I.C.) mainly to camouflage the irregularities being committed. It was argued that the Minister, Family Welfare allotted the work of purchase of medical kits and medicines to U.P.S.I.C. i....
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....children free of cost. But nowhere spectacles have been distributed though full payment has been made to the Minister's close aide. Budgetary sanction of Rs. 400 crore was made for "Janani Suraksha Yojana" wherein payments were made to fictitious people. It was submitted that this fact came to light at the Red Cross Bal Mahila Chikitsalaya but nothing was done due to the involvement of the Minister. Also, none of the eight to ten women and children hospitals in Lucknow have been supplied with caesarean kits and related medical supply needed at the time of child birth. 22. Substantiating their pleading that the Government had knowledge of the NRHM irregularities and misappropriation of funds but it omitted to act prudently, since its functionaries were party to the gross irregularities and misappropriation of funds, the petitioners placed before us bulky documents including the Press Release by the Chief Minister Information Centre dated 7.4.2011, various orders of the State Government relating to NRHM, copy of FIRs registered in Lucknow alleging financial irregularities committed by officers/officials at Department of Health and Department of Family Welfare, Visit Reports of t....
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.... for personal gains. 26. In nutshell, failure to reconstitute State Health Mission and gross irregularities in purchase of various items and failure on the part of the State Government to take effective measures to monitor the implementation of the NRHM so as to check the misappropriation of funds at various levels according to them makes out a clear case of enquiry by CBI. More so, when neither any FIR has been lodged nor the State undertook to take any action to identify the guilty persons until cognisance was taken by this Court in various writ petitions showing abuse and misuse of power by the State functionaries in the implementation of NRHM in the State of Uttar Pradesh. 27. Sri J.N. Mathur, learned Additional Advocate General assisted by Sri D.K. Upadhyaya, learned Chief Standing Counsel appearing for the State does not deny the fact that there have been large scale irregularities in the implementation of NRHM so far as the State of U.P. is concerned but according to him it cannot be termed as misappropriation of funds but it is a case of financial mismanagement. He states that corrective measures are being taken by the State to the extent that the affairs of the NRHM in L....
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....ment of the State Government is outside CBI's mandate and purview. Questioning the competence of CBI to conduct a preliminary enquiry in the matter, learned Additional Advocate General argued that Section 6-A of the Delhi Special Police Establishment Act, 1946 (CBI Act) is not the source of power for CBI to conduct an enquiry. In fact, inquiry is not defined either in the CBI Act or the Central Vigilance Commission Act, 2003 and therefore one can only abide by the expression as defined in the Criminal Procedure Code, 1973 (Cr.P.C.), precisely Section 2(g) according to which inquiry means every inquiry, other than a trial conducted under the Cr.P.C. by a Magistrate or a Court. 30. In response, leading the arguments Ms. Kamini Jaiswal, learned counsel for one of the petitioners, refuted the aforesaid contention. She submitted that Section 6-A of the CBI Act clearly empowers the CBI to conduct an inquiry. Explaining further she stated that Chapter - IX of the CBI Manual provides for preliminary enquiry to be conducted by CBI where paragraph 9.1 of the CBI Manual contemplates preliminary enquiry in such situations where adequate evidence to register a regular case is not available....
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....ment of the State Government, if would lead to chaos. 34. In fact, we have noticed throughout the hearing of the matter that the State is curiously apprehensive about CBI. Learned Additional Advocate General has throughout the hearing of the matter urged only two things. First, that the State Government is doing all it can to instill the public confidence and punish the guilty. Second, the State does not want its functionaries to suffer the rigor of CBI which would otherwise be detrimental to its subjects. 35. There is no reason why the State should be so apprehensive about CBI's conduct. CBI is an independent and autonomous investigation agency. It was for the purpose of maintaining its autonomy to conduct enquiry and investigations in a fair, transparent and competent manner that the Apex Court in Vineet Narain v. Union of India, (1998) 1 SCC 226 insulated this institution by issuing comprehensive directions so that it functions in a strong and competent manner without executive interference. Distinction was drawn so far as the expression "superintendence and administration of special police establishment" used in Section 4 of the CBI Act is concerned in as much as it was h....
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.... by Sri Sudhir Kumar, Advocate through Dr. L.P. Mishra, learned counsel appearing for the applicant. The third application was moved by Sri Saurabh Jain, the sole proprietor of M/s. Guru Kripa Enterprises and M/s. Siddhi Traders whose firms are named in the writ petition. 40. Sri S.K. Dholakia, learned senior counsel assisted by Sri Dwijendra Mishra, appearing for Sri Saurabh Jain strenuously argued that false and baseless allegations have been made against them in the writ petition. Learned counsel submitted that, in fact, U.P.S.I.C., awarded contract of Rs. 4,74,82,500 crore to M/s. Guru Kripa Enterprises and Rs. 13.69 crore to M/s. Siddhi Traders for different work which includes the task of fixing hoardings and not contracts worth Rs. 119 crore as averred in one of the writ petitions. 41. Sri S.K. Dholakia urged that CBI must not be ordered to hold an enquiry based on the averments of the instant writ petition which in his view are vague, bald, and baseless and if such an order is to be made, it ought to be made after giving him due opportunity to put his defence since it is his client and his firms against whom averments have primarily been made. Learned senior counsel place....
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....ctive clauses on nurse and ANM recruitment excludes qualified nurses and ANMs substantially and thus requires changes. Miscommunications and misunderstandings are immediate bottlenecks which should be overcomed. Electricity supply gaps in all sub-centres and additional PHCs to be closed. (ii) November 25 to December 5, 2008. districts Unnao & Bahraich: Post-delivery stay in the facilities is very short - needs monitoring. Bio medical waste management needs attention. Mobile medical units not operationalized. Shortage of human resources at all levels. Acute shortage of multipurpose worker (male). Integrated vector control measures and surveillance of diseases is weak. Poor availability of MTP/MVA (medical termination of pregnancy) services. PRIs not uniformly involved for VHSC which are recently instituted but not active. (iii) November 3 to December 13, 2009, districts Allahabad and Kanpur city: In most facilities one or more requirements for providing FRU (First Referral Units) services were not available. The State does not have an emergency transport system and ambulances were....
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....and expedite signing of MoU. (iii) Third JRM - January 16-20, 2007 Appointment of full time Mission Director in accordance with Government of India guidelines. Establishment of the Programme Management Unit structure at the State, division, district and block level. Completion of the mapping of human resources and physical structures (including equipment) and reallocate staff for optimal utilization of resources; Ensure that staff at district level and below as well as NGOs and Panchayati Raj institutions are aware of all available guidelines and sanctions. Sub-optimal utilization of existing resources. The existing specialists were not utilized appropriately as some of the supporting equipment and skills were absence. For example, the Gynaecologist, Anaesthetist and Surgeon at Gola PHC could not function as no anaesthesia or surgical equipment was in place. The FRUs are not fully functional according to the Government of India guidelines. The staff was not fully aware on the details of operationalization and management of these facilities. The coverage of key RCH services is inadequate; the quality of RCH services als....
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....ll 71 districts; 823 posts for block level accountants have been approved. No proper system of reporting FMRs and books of account to the State by the Districts initiated. Reportedly the State has been able to get the concurrent audit initiated in 69 out of 71 districts. A few concurrent audit reports received from Sitapur, Balrampur, Kannauj, Lakhimpur, Kushinagar and Gorakhpur during 2008-09 were reviewed and it was noted that some important internal control observations pertaining to advances, fixed assets, bearer cheques being issued, bank reconciliation, etc. There has however not been any follow up on these observations from the state and the auditor has also not reported on the compliance of the observations in the audit report for next month (except Balrampur). It is also noted that concurrent audit at the state level is not being done after June 2008. Detailed Guidelines for accounting system and reporting of expenditure by Blocks to Districts should be prepared alongwith the specified format for reporting of expenditure. Identify the institution for providing training to Block level Accountants/Clerks. Proper Guidelines for utilizat....
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....tion. No documents could be shown wherein the lacunae in the inspection reports [...] to the construction agencies and accountability fixed. Merely purchasing through a state government PSU does not satisfy the norms of propriety in fund utilisation. A procurement of kits from the UP Civil Supplies Corporation had been made at double the amounts specified in the PIP and the same had been signed off on by the DG without any tendering or comparison with other agencies being attempted. Emergency Referral Transport Services: [...] 273 vehicles had been received from Tata Motors (vendor) against 104 vehicles were distributed to the districts. However the vehicles were not operational and till December, 2010 operator selection, procedure for GPRS system linkages etc. had not been implemented. The vehicles have been idle for a long period of time may become non functional. Only mere procurement is not sufficient condition, proper utilisation a/so needs to be looked into to ensure propriety of expenditure. The Executive Council {headed by the MD, NRHM) had taken a decision in 2009-10 to place funds for procurement, civil works, IEC and some HQ expens....
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...., Sitapur, Kanpur Dehat, Barabanki, Sultanpur and Lucknow. Few observations are as below: Procurements: In 2009-11, Rs. 334.62 crore was available with DG(FW) office for various procurement activities. However, expenditure for Rs. 178.65 crore (53%) only had been reported till 12.5.2011 and advances of Rs. 93.62 crore were lying with implementation agencies comprising of state agencies of Uttar Pradesh and outside parties as on 12.5.2011, resulting in an estimated loss of interest on amount given to different implementation agencies of Rs. 1,57 crore. Irregularities in procedure were noticed during award of contracts for Mobile Medical Units, Hospital Waste Management, Hospital Cleaning and Gardening, Safe Drinking Water (R.O. System) etc. Civil Construction Works: Analysis of civil works under NRHM during 2009-11 revealed that the DG(FW)'s office merely transferred funds for civil works to Project Implementation Agencies (state government agencies viz. U.P. Processing & Construction Co-operative Federation Ltd. (PACCFED), Uttar Pradesh Projects Corporation Ltd. (UPPCL), Construction and Design Services (CDS), UP, Jal Nigam, Uttar Pradesh Labour and Construction....
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....s given to a firm without inviting tenders which resulted in loss to the State exchequer of the lowest supply rates against which contract could have been floated. Hoarding work of Rs. 9.75 crore done without floating tender, the State incurred a loss of Rs. 6.16 lakhs; 988 ambulances were ordered for Emergency Medical Transport Services above the R.C. rate (rate contract) and therefore State incurred loss of Rs. 99.73 (unit) lakhs; The concerned firm that supplied M.B.A.N.S.V. kit for the Mission at Rs. 4,42,04,250.00 was over and above the R.C. rate which incurred loss to the Mission; Rs. 86,995 spent on irregular purchases; Without taking into account the estimates, the firm was advanced Rs. 4537.26 lakhs and Rs. 8900.00 lakhs all at once. 49. The Financial Monitoring Reports of State of U.P. or in other words, statutory audit reports for the financial year 2005-06, 2006-07, 2007-08, 2008-09 and 2009-10 indicate proper books of accounts, ledgers have not been maintained. The main findings are highlighted below: (i) Year 2005-06: Maintenance of Accounts: Maintenance of books of accounts at districts, Unit and Head Office is not f....
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....aintained properly. Payment through Cheque--JSY: In case of payments of incentives for Janani Suraksha Yojna, there was an instruction from State Project Management Unit to make payment of incentives through bearer cheques but in some cases Primary Health Centres and Community Health Centers payment made in cash. This should be avoided. Purchase Procedure: A laxity is noted in case of providing purchase order for supply/services. This should be viewed seriously and purchase rules should be followed. (iv) Year 2008-09 Pulse Polio-Utilisation Certificate: Funds for IPPI being given in the personal name of the officers and UC's are not received on a timely basis increasing risk of misuse. Parallel fund released from Family Welfare Department is creating confusion. Difference in balance of Advance: There is a difference of Rs. 226,42,83,225 between advances as on 31.3.2008 (as per audit report 2007-08) and as on 1.4.2008 (as per audit report 2008-09). Advance given to UNOPS: An advance of Rs. 75 crores was given to UNOPS in October-November, 2008 for supplies of medicines/equipments. Out of this, Rs. 3.43 crore were utilized till the year a....
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....ct, 55% of the allocated fund utilized till December 2008. Report of districts--Etawah, Etah, Ghaziabad, Allahabad, Pratapgarh, Jhansi, Lalitpur, Pilibhit, Mahoba, Shahjahanpur and Kushinagar: Human Resource: Staff position was less than the sanctioned posts in visited SCs, PHCs/CHCs and in many districts. Vacancies existed in the sanctioned strength of medical & paramedical staff in all the districts. RKS & VHSC: Scope to improve RKS functioning in Etawah and Etah districts and in Pratapgarh district by taking follow up action of earlier meeting. Less representation of PRI in executive committee observed, VHSC meetings not held regularly in all the districts. Untied funds: Meeting proceedings at CHC/PHC level were not properly recorded in Shahjahanpur. Joint account of Pradhan and ANMs opened at SC level but lack of cooperation among them in Etawah district. Various districts were utilizing the funds but statement of expenditure was not maintained. General observations: Human Resource: Multipurpose health worker (male) posts are vacant at most of the sub-centres visited. Untied funds: Various districts are utilizing the funds....
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....ithout any due authorisation. It is also not on record whether any meeting of State Health Mission was ever held, even if it was constituted under the aegis of the previous Government. 53. Learned Additional Advocate General reiterating that this Court must consider the prayer of the petitioners in the light of the CAG Report argued that State has little role to play in the implementation of NRHM as the State Health Mission was only to guide the implementation of the Mission. Even the grants by the Central Government were sent directly to the State Health Society. He urged that State functionaries of the level of Ministers and above had no role to play in the implementation of the Mission. Accordingly, he says the State Health Mission was constituted in terms of Para. 8.1 of the MoU; but the need to hold any meeting was not felt. 54. With regard to procurements of goods and articles through U.P.S.I.C., the State clarified that the decision to route supply for articles and goods for NRHM through U.P.S.I.C. was taken in view of the G.O. dated 1.7.2000 read with 26.3.2004 and the aforesaid government orders were in vogue when such items were procured. It was a policy decision to pro....
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....ernment of Uttar Pradesh and not the State Health Society or such other entity envisaged in the MoU; (2) the MoU envisages the primary responsibility on the State Government to monitor the funds routed through the MoU which are used for financing the State Sector PIP and are kept intact and not diverted. Clarifying further, Ms. Kamini Jaiswal submitted that the argument of learned Additional Advocate General that state functionaries of the level of Minister and above had no role to play in the implementation of NRHM in the State must be appreciated in light of the fact that the two Ministers resigned taking moral responsibility of the gross irregularities being committed in the implementation of NRHM and also that State has been consistently involved in the affairs of NRHM which can be duly inferred from the fact that several government orders concerning NRHM have been issued from time to time, and also for the facts, referred to in the earlier part of this order. 60. In this context, Sri Akhilesh Kalra stated that the fact that State Health Mission was constituted as submitted by the State is not correct. Learned counsel stated that State Health Mission was constituted by the ear....
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....gnation of the Ministers underlines the adverse state of affairs in the implementation of NRHM of which fact the Ministers were conscious. 63. Despite detection of the financial irregularities in the affairs of NRHM which is evident from the documents aforesaid, till date no FIR has been lodged against any person on behalf of the State but for the NRHM affairs of Lucknow, nor any effort has been made to bring the persons guilty to trial. The enquiries that they have setup were setup only when the cognizance was taken up by the Court and curiously only on one and the same day i.e. 11.7.2011 seven enquiries were constituted. In other words, till the Court took cognisance no effort was made by the State Government to take any action either departmentally or criminal against erring persons, which shows their complete reluctance to identify the erring persons/officers/officials. 64. We fail to appreciate that when so many reports were coming forward and one Press Release was issued by the State of U.P. itself taking cognisance of the matter then why effective steps were not taken till date for dealing with such gross irregularities. The State has not been able to explain its aforesaid....
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....ar to have been handled in such a manner which suffers from gross inaction and omissions wherein public money has been seemingly misutilised by the public functionaries apparently in collusion with the private stakeholders. 70. The consequence and effect of such inaction and omission on the part of the State have necessarily to be found out for which an independent enquiry by an independent agency as CBI is necessary. This would also be in consonance with the provision of Section 6-A of the CBI Act and para 9.1 of the CBI Manual that provides that where sufficient evidence is not available to register a regular case, preliminary enquiry may be conducted. 71. We are prima facie convinced that gross irregularities - financial and administrative appear to have been committed in the execution and implementation of NRHM including the matter of award of contracts, procurement of goods, articles and etc. at various levels. In the facts and circumstances of the instant matter, we are not inclined to grant the plea of learned Additional Advocate General that we should wait for the CAG Report before considering to entrust the matter to CBI in light of the fact that CAG is conducting a spe....