MIHAN SCAM-MADC rapped for favouring CARE hospitals-TIMES OF INDIA

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MADC rapped for favouring CARE hospitals

TNN | Apr 23, 2011, 01.01am IST

NAGPUR: The Maharashtra Airport Development Company (MADC) has been pulled yet again by the comptroller and auditor general (CAG) - the regulator for government bodies. The CAG report tabled in the state assembly this week says that MADC management unduly favoured Hyderabad-based Care Group of hospitals leading to a loss of Rs 8.8 crore to this state-government company. The MADC is coming up with the much-touted Mihan-SEZ. Quality Care of India Limited, a joint venture of US' John Hopkins and CARE Group, was allotted 74 acres of land in the SEZ for setting up a state-of-the-art health complex. The land was allotted for Rs 36.60 crore in November 2008. RC Sinha was at the helm of the affairs at MADC at that time. An advance of 20% of the amount too was paid. The company, however, defaulted in paying the rest of the money which became overdue by October 2010. 

However, MADC went soft on it and did not recover the penalty which could have been otherwise due on account of the delay. In all other cases a clause of charging Rs 5 lakh per week of delay was incorporated, but not in the case of Quality Care. The CAG has calculated a loss of Rs 8.80 crore on this account, which the regulator says should have been recovered from Quality Care. 

CAG has also pointed out that Quality Care expression of interest for this projects were invited through an advertisement published in a single newspaper only. The regulator rapped MADC for not publishing the advertisement in any of the vernacular dailies. 

Quality Care was the only company to respond to the expression of interest (EoI) and the MADC did not go for a fresh round. CAG has noted that this situation could have been avoided. The tender documents were e-mailed to Quality Care instead of adopting the regular mode of registered post. This move by MADC has also drawn CAG's flak. 

Last year, the CAG had pulled up MADC for allotting land to controversial IT firm Satyam Computers at a throwaway price. Sinha was a non-executive director in Satyam's sister concern Maytas at the time of allotment. He later resigned when the Rajus' fraud came to fore.