CAG's CWG Audit Report - Chapter - 17 (2011)

8/6/2019 CAG's CWG Audit Report - Chapter - 17 (2011)

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c : : :wl-e..::I:uVenues Developed byCentral Public Works Department

CPWD was engaged by the Sports Authority of India (SAl) for upgradation/ renovation offive competition venues - lawaharlal Nehru stadium, Dr. SPMukherjee stadium, MajorDhyan Chand National stadium, Indira Gandhi stadium, and Dr. Karni Singh ShootingRangel as well as one training venue - DPSIRK Puram. In addition, CPWD renovated theKadarpur Shooting Range on behalf of CRPF.

We found that the appointment of Consulting Engineering Services (CES) as the maindesign consultant for the five main stadia, in September / October 20061was seriouslyflawed. CESwas favoured at the evaluation stage by award of marks on "concept desiqn"(which were largely outputs of a previous set of consultancy contracts for "conditionsurvey" awarded to CES). Further, the technical qualification of CESon the basis of"concept desiqn" is all the more amtuinq, since oc's consultont, EKSwas engaged only inNovember 2006 and thereafter prepared the venue briefs, on the basis of which "conceptdesigns IIwere to be prepared. Theperformance of CESin almost all the venue consultancycontracts was abysmal. Thefinancial liability of CESfor numerous deficiencies should bedetermined, and CES should be blacklisted for consideration for future consultancycontracts. We also recommend that CPWD's Central Design Organisation bestrenqthened, to reduce undue dependence on external consultants.A Centralised Co-ordination Committee, chaired by Cnairman, OC and includingrepresentatives from venue owners/ implementing aqencies, was responsible forselection of brands of sports surfaces. We found clear instances of favouritism and biasshown by this Committee (which was largely guided by the ~C) in selecting sport surfacesfor athletic tracks, hockey turf and badminton court mats.Ajoint tendering mechanism was put in place for selection of agencies for laying the sportssurfaces at the venues. We found serious deficiencies in the award of the contract forlaying of synthetic athletic track surfaces by CPWD to Shiv Naresh Sports Pvt. Ltd. Therestrictive tendering conditions resulted in a situation where the awarded rates weremuch higher than comparative rates. We also found that the area over which synthetictrack was laid included 91130 sqm outside the main track and area of final warm-up andcall rooms at lLN Stadium at a cost of Rs.6.63crore; we are unable to derive assurance thatthis additional quantity was required for the Games, and confirmed as such by OC. We alsofound deficiencies in the quality of the main competition track during our field visits inNovember 2010.A joint tendering mechanism was evolved for supply and installation of VVIP/ VIP chairsand media chairs for five venues. We found a systematic pattern of calculations and re-

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Chapter 17 - Venues Developed by Central Public Works Department

calculations for inflation of rates, which ultimately benefited the vendor, SuperiorFurnitures.

We found massive overkill in purportedly building "redundancy" in power supplyarrangements for the venues, including: Installation of DG Sets as permanent fixtures (the prospects of utilisation of which

during the non-events period are negligible) for "critical loads" as assessed by CPWDwhich were close to the normal power requirement;

Installation of UPS(whose requirement on a legacy basis iSIin our opinion, more or lessinsignificant); and

Hiring of additional DGsets of huge capacity by OC.In Jawaharlal Nehru Stadium, we found instances of non-adjustment for work notexecuted Iextra payments for work already covered by the scope of the lumpsum contract,and non-levy of compensation for delayed completion of the work of the membrane roof.The creation of a tunnel at JNSfor entry and exit of performing artistes at the opening andclosing ceremonies was initiated only in November 2009; we are unable to ascertain howmuch of the delays are attributable to the introduction of the tunnel at this late stage.During a joint inspection in January 20111 we found several deficiencies in execution ofwork, including leakages in underground parking and evidence of water logging in thelower basement.Themain work of Dr. Shyama Prasad Mukherjee Swimming Pool Complex was awarded ona lumpsum contract. We found a number of concessions to the contractor, in deviationfrom the spirit of the lumpsum contract-large number of extra items, additional paymentfor work covered in the original contract, as well as substitution of the original galvalume(aluminium-zinc coated steel) roof with an aluminium roofing system, due to the failure ofthe contractor; this was also noticed in the replacement of the roof at JNS Weightliftingauditorium. The essence of the lumpsum character of the contract wasl thus, defeated. Wealso found instances of execution of poor quality of work.Work at the Indira Gandhi Stadium Complex involved upgradationj construction of venuesfor cyclingl gymnastics and wrestling. Wefound that an otherwise ineligible firm for thecomposite work of the indoor cycling velodrome was qualified (and ultimately became thesuccessful bidder) through a change in accounting periods (to ensure compliance with thecondition of not having incurred losses in more than 2 of the last 5 years}, as well asinconsistent and unreliable figures of liabilities. Strangely I competition for laying thepermanent timbre track for the velodrome was limited to Indian furniture contractors (inassociation with an international track design and construction expert], with no attemptto float international tenders; this was compounded by dilution of eligibility criteria. Wealso found deficiencies in the bidding process for the wrestling stadium, with aninexplicable delay of four months in declaring the pre-qualified bidders, ultimately

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resulting in a single financial bid, which raises concerns on the competitiveness of thebidding process. Further; we found numerous irregularities/ relaxations in the tenderingprocess for different works relating to the gymnastics stadium, hostel/ media centre androads, boundary wall etc. to favour a particular bidder; Swadeshi Construction Co. Ourverification of its correspondence address revealed that it was a residence I casting furtherdoubt on its credibility and authenticity.In the case of the Major Dhyan Chand Stadium, we found dilution of pre-qualificationcriteria benefiting a particular contractor; further; estimates were lowered substantiallyfrom the RFQ to the RFP staqe, which may have discouraged larger companies fromparticipating. We also found that the "justlfied" rates calculated by the CPWDdid not trulyreflect the market, as we found evidence of much lower rates for components of the mainwork from outsourced agencies. Aisol despite additional costs for reduced time period forcompletion factored into the 'Justification IIprocess, the project took 37months, againstthe stipulated 18months; no compensation had, however; been levied. We also foundinexplicable delays, with re-tendering twice along with dilution of bid criteria, in award ofthe work of the PAsystem to a firm, which was ineligible in the first and second rounds oftendering.The originally envisaged renovation/ upgradation of Dr. Karni Singh Shooting Range waschanged to reconstruction of ranges after a delay of seven months, creating a squeeze oftime at the execution stage. Due to the failure of the contractor; part of the work wasawarded (after relaxation of eligibility conditions to another agency). We founddeficiencies in the quality of works executed I which persisted even after the Games. Wealso found certain deficiencies in the execution of works at the Kadarpur Shooting Range.The training facilities to be constructed at the CRPFcampus, lharoda Kalan for policesportspersons for participation in CWG-20101 had not been completed.

17.1 Engagement of Designconsultants

The competition venues were finalised inJanuary 2006 in the 9th Group of Ministers(GoM) meeting. Subsequently, in November

comments on the appropriateness ofthe proposed infrastructure for meetinginternationally accepted standards;

17.1.1 Venue Appraisal Studies andVenue Briefs by EKS technical venue requirements;

recommendations regarding alternatevenue opportunities/ upgradation ofexisting venues; and

In June 2005, at the conceptualisation stageof the CWG - 2010, EKSwas appointed' as aconsultant for conducting a baseline study-'Venue Appraisal Services' (VAS).Thisincluded preparation of Master Plan for CWG -2010 venues, etc.

On the proposal of OC to the GaM in its 4th Meeting inMarch 2005 at a cost of Rs. 0.49 crore to be borne byDDA

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Chapter 17 - VenuesDeveloped by Central PublicWorks Department

For the engagement of specialized agenciesfor consultancy services for works in all thestadia, an evaluation committee", on theapproval of the Additional Director General(TD) - CPWD, was constituted. The tendersfor the main consultancy contracts for thedevelopment of the five stadia, for CWG -2010 were floated by the individualstadiums. Details of firms that technicallyqualified and then were awarded theconsultancy contract are given in Table 17.1.

Table 17.1- Consultancy firms technically qualified and awarded consultancy contract

2006, EKSwas again appointed as the mainconsultant by the OC for preparing VenueBriefs, which were to be the basic guidingdocuments for the venue developer todevelop sports venues for hostinginternational sports events during CWG -2010.The venue briefs stipulated that the designand technical solutions for venuedevelopment were to be prepared by thedesign consultants appointed by therespective agencies.17.1.2 Engagement of CESfor

"Condition Survey"In July 2004, soon after the award of CWG-2010 to Delhi but before planning for thesame had started at the Government'slevel, SAl entrusted renovation of stadia toCPWD. Following this (in March 2005), CESwas awarded contracts for condition surveyand repairs for five stadia namely - MDCNational Stadium, Dr. S.P.MSwimmingComplex, Indira Gandhi Stadium Complex,Jawaharlal Nehru Stadium, and Karni SinghShooting Range for a total consultancy feeof Rs.0.43 crore'. As a part of this set of

earlier contracts, CESprepared reports inseveral volumes for all these stadia, whichincluded concept designs, BOQs, technicalspecifications, etc. These contracts werecontinuing even in March 2007; the exactdates of completion of contracts could notbe ascertained from CPWD.17.1.3 Selection of Consultant

Engineering Services (I) Ltd. (CES)by CPWD as main consultant in allthe five stadia

In the meantime, subsequent to theidentification of the venues, CPWD initiatedthe work of award / identification of DesignConsultants for its venues during the periodJune - July 2006.

Firms pre-qualified.short listed Firm awardedthe workJawaharlalNehruSportsComplex

JNSComplex CES(I) Pvt Ltd. STUPConsultantsPvt.Ltd. RITESLtd. TataConsultingEngineersLtd. IntercontinentalConsultantsandTechnocratsPvt. Ltd.(ICT) DalaiMott MacDonald

Firm declaredtechnically qualifiedCES(I) Pvt.Ltd. CES(I) Pvt.Ltd.

MOC + KSSR=Rs.9.87Iakh; IG+SPM =Rs. 12.55 lakh; lNS =Rs. 20.441akhMembers of the committee were CECOO-cum-Project Manager CWG - 2010; CE(NOZ) -IV; CE (Electrical); Chief Architect;ED-Finance (SAl); SE (Oesigns)-I, COO; SE(Oesigns)-II, COO; and SEOCC- 111-member-Secretary.

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Firms pre-qualified.short listedJNSWeightlifting Auditorium CES(I) Pvt Ltd.

Firm declaredtechnically qualified

Firm awardedthe work

IndiraGandhiStadiumComplex(in twopackages)

Package-I (Gymnastics) CES(I) Pvt Ltd. STUPConsultants Pvt. Ltd. Development Consultants Pvt. Ltd. M. N. Dastur Ltd. Construma Consultants Pvt. Ltd.

CES(I) Pvt. Ltd. CES(I) Pvt. Ltd.

Package-II (Wrestling, Warm-up Halls forGymnastics, External Utilities)Fivefirms pre-qualified which included' FMM Pvt. Ltd. Span Consultants Pvt. Ltd. CES(I) Ltd.

Dr. S.P.M.SwimmingPoolComplex

CES(I) Pvt Ltd. STUPConsultants Pvt. Ltd. RITESLtd. Tata Consulting Engineers Ltd. Intercontinental Consultants andTechnocrats Pvt. Ltd.

CES(I) Pvt. Ltd. IntercontinentalConsultants andTechnocrats Pvt.Ltd.

CES(I) Pvt. Ltd.

Major Dhyan CES(I) Pvt Ltd.Chand Hockey STUPConsultants Pvt. Ltd.Stadium Mott MacDonald Pvt. Ltd.

CES(I) Pvt. Ltd. CES(I) Pvt. Ltd.

Dr. KarniSinghShootingRange

Kothari & Associates. Span Consultants Pvt. Ltd. CES(I) Ltd. Architects Bureau TEAM

CES(I) Pvt. Ltd. SpanConsultantsPvt. Ltd.

CES(I) Pvt. Ltd.

C ES technically qualified in all the fivecontracts. In three stadia, its financial bidwas the only one to be opened, effectivelydenying the benefit of competitive bidding.

Other details not available in records furnished to audit

The contracts for design consultancy wereawarded to C E S in all the five venues at therates indicated in Table 17.2:

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Table 17.2 - Stadiu m w ise aw arded cost of con sultancy services to C ESVenue Awarded Cost

Rs. 22.96 crore

Jawaharlal Nehru Stadium Complex Rs.8.97 croreIndira Gandhi StadiumComplex (in two packages)

Rs. 5.17 crore(The scope of work increased, post award, toinclude interior space planning of gymnasticsstadium at an additional cost of Rs.0.38 crore)

Dr. S.P.M. Swimming Pool Complex Rs. 6.41 croreMajor Dhyan Chand Hockey Stadium Rs. 2.09 croreDr. Karni Singh Shooting Range Rs.0.32 crore

(Original consultancy work not foreclosed, andnew consultancy work assigned at an additionalcost of Rs.0.55 crore augmenting the cost ofconsultancy work to Rs.0.80 crore)

Total

We found that CESemerged as the onlytechnically qualified bidder for three stadia,primarily on account of marks assigned tothem on the parameters of 'conceptdesigns' and other details (which werelargely outputs of the previous set of

consultancy contracts). All other bidders,despite possessing specific experience insports stadia, were held to be technicallynot qualified, by assigning lower scores tothem on the parameters of 'concept design'as indicated in the Table 17.3:

Table 17.3 - M arks obtained bidders on the param eter of concept designMaximum and minimum

qualifying marksMarks obtained onconcept design

Firm Declaredtechnically qualified

Jawaharlal Maximum Marks - 30 CES(I) Pvt Ltd - 26.62 CES(I) Pvt Ltd.Nehru Stadium Minimum Marks - 22 ICTPvt. Ltd. - 10.87Complex TCE Ltd. -16.59Indira Gandhi Details regarding marks Details regarding marks CES(I) Pvt Ltd. for both theStadium obtained not furnished. obtained not furnished. packagesComplex (intwo packages)Dr. S.P.M. Maximum Marks - 30 CES(I) Pvt Ltd - 26.00 CES(I) Pvt Ltd andSwimming Minimum Marks - 20 ICTPvt. Ltd. - 22.50 ICTPvt. Ltd qualifiedPool Complex (Financial offer was evaluatedon techno-commercial

parameters where ICTscored68 marks and CES86.64 )

Major Dhyan Maximum Marks - 20 CES(I) Pvt Ltd -17.50 CES(I) Pvt Ltd.Chand Hockey Minimum Marks - 15 Matt MacDonald Pvt.Stadium Ltd. -7.50 STUP-0.00Dr. Karni Singh Maximum Marks - 40 CES(I) Pvt Ltd - 27.50 CES(I) Pvt Ltd. & SpanShooting Minimum Marks - 25 Span- 31.00 qualified (CESquoted theRange lowest Rates of Rs.39.511akhas against Span's quote of

Rs.61.73 lakh)



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Chapter 17 -VenuesDeveloped by Central PublicWorks Department

C ES did not directly possess specificexperience in designing sports stadia,with its experience being primarily inproviding design consultancy for roadsand bridges. It could show experiencefor building sports stadia only throughpurportedly "associating" with foreignconsultants, and that too only afterpurchasing the PQ documents (all theMoU submitted were signed on datesfalling after the PQ documents werepurchased). Other bidders who weretechnically rejected had fairly goodexperience in construction of sportsstadia viz.

Mott MacDonald - Wembley Stadium inLondon, Melbourne Cricket Ground inAustralia, Lord's cricket ground inLondon;

STUP- Stadia for National Games inGuwahati and Hyderabad, Twin TurfHockey Stadium at Hyderabad.

Further, we could not see, throughperusal of various designs anddocuments submitted by the consultant,the contributions of the foreignconsultants, on the basis of which CESwas deemed to be technically qualifiedvis-a-vis sports stadia. In response to ou rquery, CPWD stated that the tenderconditions did not insist on thesignature of the foreign consultant.However, in view of the contractualprovision regarding involvement of theforeign consultants to the extent of notless than 60 per cent of the total fee,documentary evidence of the actualinvolvement of the foreign consultantsin work was essential.

The technical qualification of CESprimarily on the basis of the 'concept

designs' submitted by it as part of thebidding process is all the more amazing,since EKSwas engaged only inNovember 2006 and prepared thevenue briefs thereafter, based on whichthe concept designs were required to beprepared. Without the venue briefs (andwithout adequate time being provided),the other bidders could not have beenexpected to prepare such designs at thebidding stage, nor was this at allnecessary. This advantage to CESwasirregularly facilitated by CPWD byincluding the concept designrequirement in the RFPfor consultancycontracts, well before even the venuebrief was ready. This effectively favouredCES.

In response to our observation, CPWDreplied that the condition survey wasconducted to assess the repair andretrofitting cost and nothing wasdecided about the new structures.Therefore no insight was available toCESregarding the nature and scope ofwork for CWG-2010. Moreover conceptplan was desired to judge the aptitudeand vision, and the consultants who arebidding for mega sports stadia canprepare concept plan on the basis ofscope of work, site visits and pre-bidmeetings.

However, the advantage to CESisevident from its own statement in thesection "Project Appreciation" of thetechnical bid document that'Consultants, during a prior assignment,took up extensive reconnaissance surveyand condition survey of installations andutilities of the area. In the process, theConsultants have gone through availabledrawings and condition survey data

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which enabled them to have fullunderstanding of the project and itsrequirement indicated in the TOR.' Thisamply evidences that the priorassignment of condition survey to CEScreated a foundation for the preparationof concept plan, project appreciationand technical proposal and thisadvantage was not available to otherbidders.

The inexperience of CESwas evident fromnumerous deficiencies noticed during theexecution of the design consultancycontracts such as frequent and drastic changes in designs

and drawings, changes in BOQs and tender documents,

frequent delays in submission of designsand drawings,

delays in obtaining approval from localbodies, and

engagement of additional specialistdesign consultants for works whichwere, primarily, the responsibility of themain consultant, etc.

Details are given in Annexe 17.1. Thisadversely affected the planning as well asexecution of the various projects. All suchdeficiencies were condoned or ignored byCPWD. Penalties for such failures wereeither not included in the contract" or,where included", were not enforced. Someof the glaring deficiencies are summarisedin Table 17.4:.

Table 17.4 - Deficiencies in consultancy work of CESStadium Deficiencies (in brief)

JLNStadium Defective assessment of the requirement of lump sum contract resulted indeviations primarily on account of changes in BOQs, resulting in grossdeviation' of Rs.41.24 crore.

JLNWeightliftingStadium and Dr. SPMSwimming Pool Complex

The scope of roofing work was changed from Zincalume steel toaluminium (Kalzip), resulting in extra payment to contractor of Rs.6.79crore.

Dr. Karni Singh ShootingRange

There were huge deviations and extra items worth Rs.20.37 crore due toimproper assessment of BOQsfor the work. The basic item of excavationin hard rock could not be envisaged earlier (despite the hilly location ofthe venue). Further, rebate of Rs.0.50 crore could not be availed.

IGStadium Complex In the work of "improvement of roof truss", there were huge deviations insteelwork alone, ranging from 83.8 per cent to 139.70 per cent,amounting to Rs.15.62 crore.

MDC National Stadium Astronomical increase in the quantities of cables, ducts, pipes etc. in thework of SITCof PAsystem and electrical component of the main workresulted in additional financial burden of Rs.4.11 crore.

Major Dhyan Chand Stadiumlawaharlal Nehru Stadium, Dr. SPM Swimming Pool Complex, Indira Gandhi Stadium Complex and Dr. Kami Singh ShootingRange.Sum of positive t+) and negative (-) deviations.

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The performance of CESin almost allthe venue consultancy contracts wasabysmal. The financial liability of CESfor the numerous deficiencies shouldbe ascertained and recorded. Further,CESshould be blacklisted forconsideration from any consultancy orother contracts with CPWD and theGol, to prevent recurrence of suchevents. In addition, responsibilitiesshould be fixed on the officials whofacilitated appointment of CESandgrant of undue favour to it in thecourse of these consultancy contracts.

Separately, several other consultants werealso engaged for other venues i.e. WADAblock, shooting range etc. (CPWD); andother sporting venues developed by DDA,PWD, GNCTD,NDMC, DU, JMIU, AlTA. Theengagement and performance of theseconsultants has been discussed in therelevant sections of the report.For the preparation of venues for the CWG- 2010, approximately Rs. 113 crore wasspent on engagement of design consultantsfor all venues including those of DDA,NDMC, PWD GNCTD and others.

17.2 Lack of organised in-housedesign skills in CPWD

CPWD's, Central Design Organisation (CDO)consists of four units namely the Design Unit; Repair & Rehabilitation Unit; Computer Centre Unit; and Technology Application Development

Cell Unit.

CDO is mainly responsible for structuralanalysis, design of large projects and specialstructures, development of in-houseexpertise in the field of repairs andrehabilitation, development of newinnovative technologies for the departmentand computerisation.The CDO currently has 1 CE,6 SEs,and 24EEs/AEs/AEEs, besides other supportingstaff. However, the CPWD did not utilise theservices of CDO for design consultancy forany of the stadia for CWG-2010, and insteadengaged external agencies for design andother consulting services for these projects,as discussed in the previous paragraph.In response, CPWD stated that: for planning and design for all the sports

stadia in a time bound manner for theCWG-2010, a well coordinatedmultidisciplinary planning and designteam covering architectural, structural,mechanical, audio-visual, IntegratedBuilding Management System etc wereessential requirements.

All these specialisations did not exist inCPWD, that too under single command,which was absolutely essential fortimely accomplishment as a coordinatedjob of multidisciplinary consultants.

Even in its limited role in structuraldesign and drawing, CDOdid not haveskilled and experienced structuralengineers to deal with the structuralcomplexities of sports stadia involvinguse of new imported structuralmaterials, necessitating latest state ofthe art technologies in structuralengineering as well as material science.

In our view, it is absolutely essential forCPWD to develop, maintain and properly

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Table 17.4 - Deficiencies in consultancy work of CESTimeline Event

24 May 2008 Constitution of (expert) committee by Shri Kalmadi14June 2008 Constitution of Committee for centralised co-ordination22July 2008 Expert committee recommended brands for various sports surfaces (in

most cases,single brands)26September 2008 CentralisedCo-ordination Committee, after considering Expert

Committee recommendations, shortlisted three brands for mostsurfaces.

16 November 2008 Expert committee shortlist conveyed to MYAS16 December 2008 List of shortlisted brandsplaced before Centralised Co-ordination

Committee for consideration. Committee decided that MYASwoulddesignate a centralised procurement agency.29 January 2009 OCfloated EOI,at SecretaryMYAS'sdirection, for offering opportunities

to other suppliers. Only four vendors for lawn bowls and two forwooden floor were considered additionally eligible.

13April 2009 Centralised Co-ordination Committee prepared a final list of shortlistedbrands.

2 July 2009 MYASapproved the list of brands shortlisted by the Centralised Co-ordination Committee.

We found clear instances of favouritismshown by the Centralised Co-ordinationCommittee (which was largely guided bythe OC), as summarised below:17.3.1.1 AthleticsThe top four brands of synthetic tracksurfaces with maximum IAAF Class-Icertificates were Mondo (19), Conica (15),Polytan (8) and Rekortan (4). The ExpertCommittee decided to procure Conica FullPURtrack surface, and ruled out Mondo",based on the following: The Athletics Federation of India

representative observed that theMondo track was earlier laid at

Mondo is the official supplier of athletic tracks for thelast nine Olympics (including Beijing Olympics 2008) aswell as the upcoming London Olympics 2012.

Thiruvananthapuram, Jamshedpur,Lucknow and New Delhi was notsuitable for Indian weather conditionsand at all these places, the track wascracked out within two years and had avery short life.

Further, the Mondo track was a pre-fabricated track, whereas other trackswere polyurethane tracks and easy torepair in case of any damage at the spot.

However, at the meeting of the CentralisedCo-ordination Committee on 26 September2008, DG SAl raised the issue of IAAFapproved brands for synthetic tracks. Again,in the Committee meeting on 2 April 2009,DG, SAl mentioned that he had beenadvised that Mondo was preferable forathletics track as it was pre-fabricated, andin case of damage to the track during the



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Opening Ceremony, the particular damagedsurface could be easily replaced. This wascountered by Shri Bhanot, and it wasdecided not to go in for pre-fabricatedsynthetic surfaces, based on the poorexperiences of pre-fabricated tracks inIndia. Finally, three brands (Conica, Polytanand Rekortan) were shortlisted.

We found no evidence / reports tosubstantiate claims of the poorperformance of Mondo's tracks. Further,the rejection of a firm supplying surfacesfor Beijing Olympics 2008 is in starkcontrast to the use of supply at BeijingOlympics 2008 as justification for vendorsfor other surfaces.

17.3.1.2 HockeyThe expert committee had shortlisted threecompanies for hockey on the assumptionthat these global surface providers wouldbe able to produce polyethylene surfaceswith the approval of International HockeyFederation (FIH) instead of the hithertoused polypropylene surfaces. However,there was a deviation in qualifying criteriafor the hockey surface, necessitating a freshEOI. After evaluation of the EOI by acommittee, four products of different fibreri.e. polyethylene, polypropylene and nylonwere recommended. These were producedby the same vendors, whose names wereshortlisted earlier. The selection ofpolyethylene, a new type of syntheticsurface instead of the hitherto usedpolypropylene surface is indicative of thefact that the criterion regarding theselection of widely used surface forselection of company was not followedconsistently by the expert committee.

17.3.1.3 BadmintonThe Expert Committee decided torecommend Yonex, since it was being usedat Beijing Olympics 2008 and other events,and also because BWF confirmed that onlyYonex court mats and shuttlecocks wereexclusively approved. We found thisassumption to be of doubtful veracity. BWFhas 23 approved brands, but has anexclusive sponsorship contract with Yonexfor use at BWF events. Although the BWFwebsite lists CWG-2010 as a BWF event, thisappears to be incorrect as the badmintonevents at neither the Olympics nor theAsian Games are listed as BWF events.17.3.1.4 Permanent timber track for

the cycling VelodromeThe Expert Committee recommendedSchuermann Architects (who built thevelodrome for Beijing Olympics-2008) asthe international technical delegate forcycling events and mentioned that noarchitect other than Schuermann Architectscould guarantee to meet the specificationsof International Cycling Union(UCI).However, this was not implemented, sincethe bidding condition stipulated by CPWDrestricted competition to Indian furniturecontractors in association with aninternational track design and constructionexpert (refer paragraph 17.8.2.4 of thereport). The contract was finally awarded toComfort Net Traders, in association withanother international architect.

Clearly, the selection of brands for sportssurfaces was not transparent andobjective. It appears from the minutesthat objections raised by venue ownerswere ignored by Shri Bhanot by givingselective technical information.

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17.3.2 Laying of synthetic athletictracks surface

As already discussed in para 17.3.1.1, theCentralised Co-ordination Committeeshortlisted three brands/ manufacturers(Conica, Polytan and Rekortan) for layingsynthetic athletic track surfaces at fivevenues", thereby creating grounds forrestrictive tendering. CPWDwas identifiedas the nodal agency for joint tendering forselection of agency to lay the track surfacesat these venues. A joint tenderingcommittee" was constituted to oversee thetendering process.17.3.2.1 Dilution of eligibility criteria to suit

the agencies that finally bid.In July 2009, Press Notice inviting bids forlaying synthetic athletic track surface at fivestadia was issued. The eligibility criteriaincluded:

Agency Eligibility CriteriaCompletion of two works(laying athletic synthetictrack surface approved byIAAF)costing not lessthan Rs.4 crore each

Manufacturersof the shortlistedbrands (havingregistered officein India)Authorized Completion of one workIndian (laying synthetic athleticRepresentatives track surfaceapproved byof manufacturers IAAF)costing not lessof the approved than Rs.4 crore eachbrands

9 lNS, Thyagraj Stadium, Chhattarsal Stadium,Commonwealth Games Village and Polo Ground of DelhiUniversity.

10 Its members included Chief Engineer (CWGP), CPWD(Chairman), Chief Engineer (PWD, GNCTD), ChiefEngineer, DDA, Addl Chief Engineer, NDMC, Univers ityEngineer, DU; Representative of SAl, SE (C), CPWD

We found that the relaxation of conditionsfrom completion of two similar works toone and reduction of value of works toRs.4 crore each (which was only 10 percentof the estimated cost of the work as againstthe generally prescribe 80 percent ofestimated cost for one work, which wouldamount to Rs.30.73 crore in case of anauthorised Indian representative bidding)was tailor made to suit only the threebidders (authorised Indian Representativeof each brand) who responded, as indicatedbelow:

AuthorisedIndianrepresentativeValue ofsingleworkcompleted(Rs.in crore)

Polytan Inderjit MehtaConstructionPvt. Ltd.

4.60

ShivNareshSports Pvt. Ltd.

Canica 4.32

Rekortan Jubilee Sports 4.99TechnologyPvt. Ltd

Clearly, all the bidders just met the muchdiluted eligibility criteria and the dilutionwas probably done only to ensure thatthese agencies could bid.17.3.2.2 Selection of Shiv Naresh Sports

Pvt. Ltd. and the reasonability ofthe rates it quoted

From the three bids received, the contractwas awarded to Shiv Naresh Sports Pvt. Ltd.(SSPL)l1who was the L1 bidder at Rs. 60.38crore for the five venues of which Rs. 27.61crore was for JNSalone.

11 SSPLwas primarily a manufacturer of sports wear asper its website.

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A thle tics track at Chhatrasal StadiumWe found that the restrictive tenderingconditions created around the tenderingprocess by limiting the competition to threebrands only resulted in a situation wherethe rate at which the contract was finally

awarded was not at all comparable with therates of similar works quoted or intimatedat different works/stages as indicated inTable 17.5.

Table 17.5 - Comparative rates of similar work obtained for different works or stages

SSPL

21.89

7,604.05 36.86 Net rate after rebate of 17.06% and additionof service tax @1O.30%.

7,337.00 35.56 Rates tendered in April 2008 inclusive of alltaxes.

N CCL at DU

BASF 4,928.70 23.88 Rates indicated by the manufacturer andpartner of SSPLin September 2009.

2,784.00 13.49 Work completed in January 2009SPL to NCCL a tRanchi

4,650.00 22.53 Rates obtained by CPWD in June 2009 forpreparing cost estimates; and

However, the agency bid at the rate ofRs. 9000 per sqm in its bid for CWG-201O.

Ju bile e S po rtsTe chnology {I}P vt. L td.

Inde rjit M ehtaC onstruction P vt.L td for C RPFCampus,Jharanda K alan

Rates offered to CPWD in February 2010for CRPFcampus at Jharoda Kalan;

However, the agency bid at the rate ofRs.8850 per sqm in its bid for CWG-201O

4,516.05

Note. The above rate only covers laying of surface track; the cost of sub-base is not included266 Performance Audit Report on X IX Commonwealth Games (CWG-2010)


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As is evident from above, advantage wastaken of the artificial restriction on theagencies that could participate as well asthe limited time, which inhibited thepossibility of re-tendering. The ratesquoted by the bidders were much higherthan the rates quoted by the sameagencies for other similar projects orpoints of time. Hence, the reasonablenessof cost at which the athletic synthetictrack surfaces were laid for CWG-2010cannot be assured by us.

17.3.2.3 Quantity and quality of workexecuted by SSPLat JNS

As per the NIT,the synthetic athletic surfacetrack was to be laid over an area of 27,530sqm. We found that this area included9,130 sqm laid outside the main track andarea of final warm up and call rooms at acost of Rs.6.63 crore. We are unable toderive assurance that the quantity of 9,130sqm was contractually required for thepurpose of CWG-2010 and confirmed as

such by the oc. Further, though the athleticsurfaces in the main competition track andthe warm up track were suitably certified asClass I and Class II, this area of 9130 sqmwas not certified.As per the performance standardsappended to the Agreement, no surfaceimperfections such as bubbles, fissures,delamination, uncured areas, bumps ordepressions should be present on thetracks. During our field visits to theStadium ground on 15, 19 and 23November 2010, we observed that in themain competition track, the surface of thetrack were uneven at numerous places,there were signs of water logging even afterdry up, and patch work had been done atover 40 places in areas ranging from 2 sqm.to 20 sqm. approximately. Apparently,there were deficiencies in the execution ofbase work resulting in depressions atnumerous places causing uneven surface,water logging and resultant patch work asstated above.

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Patches of water logging

17.3.3 Unjustified inflation of rates ofVVIP/VIP and media chairsprocured for five stadia, resulting inextra expenditure of Rs. 3.66 crore

EOlswere invited in Decembers 2009 fromthe manufacturers/suppliers of seats/chairsfor supply and installation of 15,900VVIP/VIP chairs with arms, cushion and armrest and media chairs with cushion, foldingtable and arm rest for five venues" forCWG-2010. The manufacturers/ supplierswere to visit the venues to understand therequirement and to submit salient data withbrief technical parameters/ specifications,details of turnover, manufacturing capacity,delivery period and prices {inclusive ofinstallation cost}. They were also requiredto install their samples at JNSand submitmodel wise technical specifications andcatalogues, and photos of samples installedalong with the response to EOI. Of the 15

agencies that installed their samples at JNS,a committee of seven senior officersheaded by the DG, SAl approved, inDecember 2009, a total of 14 samples {11for VVIP/VIP and 3 for Media} of sixmanufacturers".In January 2010, NIT was issued invitingagents or manufacturers of the shortlistedmakes/models to bid", Four bids werereceived. None were from themanufacturers, except Superior Furniture,who was awarded the contract based on itsLl bid in March 2010.We found that though Superior Furniturewas the Ll bidder, its rates were inflatedand CPWD justified these inflated rates byRs. 3.66 crore to award the contract. This isestablished by the estimates prepared atdifferent points of time, as depicted inFigure 17.1.

12 JNS, IG Complex, MOC, SPM, and KSSR13 Hoabo Chair Co. Ltd(China), Zhejiang Oageng Sports Equipment Co. Ltd (China), Starena Internat ional Pty Lid., Austral ia,Super ior Furnitures India, Hangzhou Juniu Chairs Industry C o Ltd (China) and Camatic Pty Ltd. Australia.

14 Shiv Naresh Sports Pvt. Ltd., Superior Furnitures, Millith Karv, and Pen Workers



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Figure 17.1 -Estimation of Rates of VVIP/VIP and Media Chair

From the calculations and re-calculationsshown above, it is evident that these weremanipulated and the rates inflated, whichultimately benefitted Superior Furniture,who was awarded the contract (March2010) to supply the chairs at a negotiatedtendered rates of Rs.5362 and Rs. 5623for VVIP/VIP and Media chairsrespectively. The additional cost on thisaccount worked out to Rs. 3.66 crore.

Further, we found that about 2500 chairscosting Rs. 1.34 crore, so installed, wereremoved from the seating areas of variousstadiums before start of the games to makebroadcasting and media platforms, which isthe normal practice in holding internationalevents. These were lying uninstalled in thestadiums.



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We also found that Superior Furniture wasalso allotted the work of designing, fixingand dismantling of Mild Steel (MS) sittingarrangement for Rs. 1.40 crore in IGComplex as extra work without calling anytender or work order.

17.4 Installation of DG Setsas permanent fixture

OC's consultant, EKS,in its venue briefstated that if two high voltage electricityfeeders were provided, critical suppliesshould be evenly distributed across boththe feeders. A backup generator of capacitysufficient for the Games 'critical supplies'should also be provided. EKShad alsoproposed provision for plug-in orpermanent prime generators. In pursuancethereof, all the venues obtained twoindependent high voltage feeders fromtheir respective power supply companies. Incontrast, in the return venue brief, thedesign consultants firm, appointed by therespective venue development agencies,

suggested permanent DGSets as backuppower source. Resultantly, taking this as aground, CPWD opted for permanentinstallation of DG Sets. The CPWD took aplea that when EKSproposed plug in type ofDG Sets it was intended for non-regularactivities like overlays which were to belooked after by OC and this was not meantfor permanent installation created byCPWD. The fact, however, remains thatdespite suggestion/ proposal from M/s EKSfor plug-in or permanent generators, CPWDinstalled all DGSets in all the five venues aspermanent fixtures without any cost benefitanalysis (permanent fixtures vis hiring asand when required). The prospects ofutilisation of these permanent DG Sets,during non-events period, are negligibleresulting in unfruitful financial burden; thiswas also the case in DU.Stadium-wise sanctioned load, critical load,DGSet capacity installed, UPSCapacityinstalled and temporary DGSets for whichorders were placed by the OC are detailedin Table 17.6:

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Table 17.6 - Details of normal sanctioned load, critical load,DG set capacity and UPScapacity.

1. Jawaharlal 12,000Nehru Stadium

2. Dr. S.P.M. Swimming 3,471Pool Complex

3. Dr. Karni Singh 2,777Shooting Range

4. Major Dhyan 3,888Chand Stadium

5. Indira Gandhi 11,111Stadium Complex

10,065 11,530 3,330 45,29015

2,806 3,750 2,500 3,660'

2,159 2,250 1,020 5,20217

4,558 4,500 3,590' 5,390(for IG

Stadium10,650 10,650 5,328 Complex,

MDCStadium

andCentralVista)

Rs.34.63 Rs.39.84Crore CroreOTALNote. Normal Power requirement as got sanctioned from the power utility - While converting the powerrequirement from KWto KVA(in cases of KSSR,MOC and IGStadium Complex), the power factor has been taken

asO.9. Critical load - While calculating the critical load/ emergency load for OG Supply, CPWO stated that theconfiguration given in the return venue brief by the design consultants carried no weightage other than confirm

to the DCthat the Games requirements would be met. The appropriate time to finalise the configuration of theOG Sets was at the time of obtaining the technical sanctions, so that the "latest requirements" were met. Hence,while justifying the critical load arrived at, in response to our audit query, CPWOstated the following issues weretaken into consideration (a) suggestions of the CfS; (b) suggestions of the fire department (c) CPWO's generalspecification for electrical work Part-I Internal; and (d) other issues which the department thought necessary.

OG Set Capacity installed - While calculating OG Set capacity, CPWOhas taken into consideration a load factorof 0.8 (80% loading) and power factor as 0.8. Further, the department has also taken into consideration parallelN+l system to provide full redundancy for the games critical supply as per the suggestions of the designconsultants (CfS).

15 Inc ludes DG Setsfor DPS, RKPuram.16 inc ludes Central vista, Talkatora Indoor Stadium and Shivaji Stadium.17 Includes Shri Fort Sports Complex, Saket Sports Complex, Thayagraj Sports Complex, lamia Milia Islamia, RK Tennis Complexand CRPFCampus (Kadarpur) - breakup not available from oc's records.

18 4 sets of 2 X 40 KVA DG Sets shifted to lNS



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Thus, an expenditure of Rs. 112.29 crorewas incurred by CPWD, DU and OC forpermanent installation of DG Sets/ UPS Rs.34.63 crore by CPWD for DGSets Rs.39.84 crore by CPWD for UPS Rs. 6.03 crore by DU for DGSets & UPS Rs.28.08 crore for hiring of DGSets

(primarily for JNS) Rs.3.71 crore for hiring of DGSets for IG

Stadium Complex & MDC Stadium.Clearly, there was a massive 'overkill' inpurportedly building 'redundancy' in powersupply, when October was identified as alean season in terms of power demand",and the Ministry of Power allocated anadditional 100 MW of power for Delhi forthe Games.The issues relating to installation of DGSetsas permanent fixtures at venues developedby other agencies (DDA, PWD, GNCTDandNDMe) are discussed in chapters pertainingto these agencies in this audit report.

17.5 Installation of additionalUPS as parallel redundancy

While installing UPSSystem for supportingnot only the Key Technology Equipments (assuggested by EKSin the venue brief and thedesign consultant in the return venue brief)but also for sports lighting, the departmenthad installed additional UPSfor a totalcapacity of 1370 KVAas parallel redundancyin MDC National Stadium, despite absence

19 The efforts of Pragati Power Corporation Ltd. inaugmenting power generation and Delhi Transco Ltd. inincreasing power transmission capacity are descr ibedsubstantially in Chapter 26.

of any such provision in the venue brief orthe return venue brief resulting in additionfinancial burden to the tune of Rs.2.01crore. This was on the instructions of theCommittee of Secretaries.

The permanent DG Sets in the stadiacould, perhaps, still be used (at least toa part of the installed capacity) fornational/international sports events.However, the requirement of UPSon alegacy basis, is in our opinion, more orless insignificant (except for the minorrequirement for key technicalequipments viz. PA Systems, computersetc. and not for sports lighting).Moreover, the batteries attached tothese UPSalso have a relatively shortlife. CPWD/ SAl may therefore consideridentifying the requirement of UPSstrictly for key technical equipments,and ensure that these are properlymaintained in the long run. Thebalance of UPS (which is likely to besubstantial) may be transferred, free ofcost/ at nominal rates, to othergovernment departments/ agenciesrequiring relatively large IT Systems(typically large data caches). This will,at least, ensure productive utilisationof these assets.



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17.6 Jawaharlal Nehru Stadium Complex

Jawaharlal Nehru Stadium

Jawaharlal Nehru Stadium Complex (JNS)was the main venue for CWG-2010. Itunderwent major redesign andreconstruction for this event. It hosted thecompetitive events for athletics, weightlifting and Lawn Bowl as well as the openingand closing ceremonies.The major works undertaken at JNSwere Construction of a new tensile

membrane roof and support structurefor it;

Structural repair & space planning ofentire JNS;

Construction of weightliftingauditorium;

Construction of Administrative Block"and World Anti Doping Agency (WADA)Laboratory;

20 Now housing the SAl. The diversion of fund of Rs. 19crare from the scheme for "Preparation of Indian Teamsfor CWG-2010" for construction of this administrativeblock is described in Chapter 32.

A Hostel! Media Accommodation block; Reconstruction of lower tiers; and Installation of sports lighting and PA

system.

17.6.1 Construction offixed tensilemembrane roofing over theseating area

CPWD awarded a lumpsum contract forconstruction of fixed tensile membraneroofing over the seating area in JNSat acost of Rs. 308.08 crore to Shapoorji Pallonji& Co. Ltd. (SPCL)for completion bySeptember 2009.17.6.1.1 Non adjustment of Rs.5.99 crore

for work not required to beexecuted

The lump-sum agreement provided forregulating increase / decrease in quantitiesof work at variation rates. Payment of Rs.314.46 crore had been made to the



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Tensile membrane roof over JNS

contractor, but adjustments totalling Rs.5.99 crore for items of work not required tobe executed were pending. Details are givenin Annexe 17.2.CPWD in its reply stated that theseadjustments would be affected in the finalbill. This shall be verified at the time ofsubsequent audit of final payments.

17.6.1.2 Extra payments of Rs.4.96 crorefor items of work covered byscope of contract

The scope of work clarified at various placesin the contract that the quoted cost of lumpsum contract would cover all incidentalwork actually required, but not specificallystated in the tender. We noted that extrapayments of Rs.4.96 crore had been made/approved for several items of work coveredwithin the cost of lump sum contract.Details are given in Annexe 17.3.

17.6.1.3 Non levy of compensation(estimated maximum of Rs. 30.80crore) for delay in completion ofwork and payment of escalationcost of Rs.7.02 crore for the EDTperiod

The work was awarded in December 2007for completion by September 2009. Theschedule of work stipulated eightmilestones and in case of non-achievementthereof, an amount equal to 0.5 percent ofthe tendered amount was required to bewithheld for the contractor's failure toachieve each of the milestones. TheContract provided for levy of compensationfrom the contractor @ 1.5 percent of thetendered cost per month subject to amaximum of 10 percent. For earlycompletion of work, the contractor wasentitled to bonus @ 1 percent per monthsubject to 5 percent of the tendered value.The work was completed in August 2010.We found that delays in achievement oftargeted completing date were at leastpartly attributable to SPCl, as indicatedbelow:



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After erection of X column inSeptember 2009, it was found thatthere were gaps in head plates,resulting in defective geometry of thealignment. To correct the alignment,the contractor took over threemonths (9 September 2009 to 7December 2009) causing delay inprogress of work;

Issues regarding fabrication anderection of ramps and catwalk,erection of cable, casting of staircase,fixing of railing, drainage pipeline etcwere not resolved as of December2009. SPCLobserved that itsassociates, viz. P&R Group (for steelwork), and Taiyo MembraneCorporation (engaged for membranework on the recommendations ofCPWD), were not committed towardscompletion of work in time due toproblems of co-ordination andorganisation;

About 61 curved beams, 40 RT1beams, RB beams, flood light mastand some catwalk structure units, andthe entire parapet were not installedeven as of 4 January 2010;

No proper methodology for laying ofthe cable on the stairs and temporaryconnecting to the lower compressionring was planned. All the ring cableswere coiled in the wrong direction,leading to loss of time in laying of thecable net, the methodology of cablejacking was flawed and incomplete.Consequently, jacking work wasstopped for 20 days during erection,and on-site strengthening was done;

The manpower, tools and machinery,and expertise for fabric installation

were found to be grossly inadequate,causing unprecedented setback tothe membrane installation and otherworks of the stadium ,

Two shipments of bolts and nuts werebrought to site only in May 2010, SSdrainage pipe were brought fromMumbai in June 2010, and theprogramme for fabrication and erectionof additional props to ramps wassubmitted only in August 2010; and

Inadequate personnel were deployedfor membrane work, the methodologyfor installation of fabric was notcorrectly planned, the length of the lightmast cable was wrongly calculated, thelength of the inner edge cable was alsowrongly estimated, and the location ofall the catwalk clamps were wrong andthey had to be shifted by 750 mm to1200 mm each.

CPWD clarified to the contractor(January 2010) that there were nohindrances at site, and issued severalnotices including on 28 April 2010, 5May 2010 and 16 August 2010, holdingthe contractor responsible for slippages,slow progress of work and non-achievement of revised milestones.

The work was certified to have beencompleted on 26 August 2010 subject tomeasurement, quality check and alsoremoval of various defects in shear walls ,stair case columns, parapet, ceiling, wall, tiebeam, ramps, ramp slab, stainless steel (SS)drainage pipe, steel structure and SSrailingrequiring rectification.Thus, the contractor was, at least partlyresponsible, for the delay of over elevenmonths in completion of work with



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numerous defects, and thus liable torecovery of compensation upto a maximumof Rs. 30.80 crore. Though several noticesfor imposition of penalty / compensationwere issued to the contractor, no action forlevy and recovery of compensation fromthe contractor was initiated. CPWD grantedextension of time upto 26 August 2010 andalso released the amount of Rs. 2.75 crorewithheld from the contractor's bills for non-achievement of 5th and 6th milestone,without any recorded justification. Takingserious note of the delays, shortcomingsand repeated failures in completion of CWGworks, the Additional Director General-in-charge of Commonwealth Games projectsdirected in August 2010 that the contractualremedies for failures of the agencies tocomplete the works in time must not belost sight of at any cost and the individualofficers shall be responsible for inaction.However, no action had been taken as ofFebruary 2011 for levy and recovery ofcompensation from the contractor.As detailed separately, the impact of lateinclusion of the tunnel in November 2009,on the erection of the membrane roofingand other construction activities of JNS isnot clear to us, on the basis of availablerecords. However the month ofcommencement of tunnel work (December2009) falls well after the scheduled date ofcompletion of the membrane roof(September 2009).Payment of Rs. 29.70 crore had been madeto the contractor as of September 2010 onaccount of increase in the cost of labourand material on the basis of rise in thequarterly cost of index as per provision ofcontract. We noted that escalation beyondthe stipulated date of completion of work

was admissible only if no penal action hadbeen taken for failure of the contractor tocomplete the work in time, as per theprovisions of the contract. Completion ofwork was delayed by over eleven monthsdue to various delays, attributable at leastpartly on the contractor/sub-contractors,but CPWD never enforced contractualremedies against the contractor, and alsomade payment of Rs.7.02 crore, as ofSeptember 2010, toward escalation costsfor periods beyond the stipulated date ofcompletion i.e., 3 September 2009.

17.6.2 Tunnel at JNSIn September 2009, in the 3rd meeting ofthe 'new' GoM, the Core Group of creativepersons, while making a presentation onthe concept and theme of the openingceremony, requested that in order tofacilitate the ingress and egress of theperforming artists during the ceremony, atunnel may be constructed from the interiorof the JNSto the outside. Minister, VASexpressed strong reservations againstincreasing the scope of work, which couldjeopardize the timely completion of thestadium that was already running againstvery tight time lines. However, the CoreGroup insisted that it would not be possibleto deliver the opening and the closingceremony, in a befitting manner, withoutthe tunnel. Finally, the 'new' GoM decidedthat it was an engineering issue and thetechnical feasibility of construction thetunnel within the time frame, keeping inmind the laying of the synthetic turf and thescheduled test events, should be carefullyconsidered by the engineering team beforea decision in this regard was taken.Thereafter, in October 2009, in the 4th



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Case Study: 17.1Exercise of powers in favour of contractorCPWDWorks Manual and Clause 10 CAofthe General Conditions of Contracts (GCe) of CPWDWorks 2007 provide for varying the amount of contract, due to increase ordecrease in price ofmaterials pertaining to the work as mentioned in Schedule Fforming part of the agreement,provided such variations were effected up to the stipulated period of contract, includingjustified extensions. Notice Inviting Tenders (NIT) for construction of weight lifting auditoriumapproved by competent authority in January 2008 did not include such provisions, which wasincluded through a corrigendum. However, the list of materials for which Clause 10CA wouldbe applicable was not appended with the corrigendum, nor included in Schedule F.Thus theagreement signed between CPWD and the contractor indicated applicability of Clause 10CAwithout appending thereto the list of materials on which the Clause would be applicable. Inthe absence of the list of materials in Schedule F,no price variation for any of material wasadmissible. CPWD erroneously made payment of Rs.0.86 crore under Clause 10 CA in respectof reinforcement steel which was objected to by audit in November 2008. CPWD admitted(July 2009) that no material was listed in Schedule Fto the agreement but stated that in thepre bid conference it was clarified to bidders that Clause 10 CA would be applicable andcontinued with similar payments adding up to Rs.1.95 crore. Audit again objected to thepayment in December 2009.We found that using the powers to modify the contract conditions, CPWD approvedmodifications to Clause 10 CA in December 2010 for inclusion of cement, reinforcement bars,structural steel sections/flat/sheets/ plates/ tubes etc in Schedule F, in disregard to thesanctity of the contract.

Weightlifting Auditorium



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17.6.3.2 Defects in execution of workJoint inspection of the site with CPWDofficers on 22 January 2011 revealed: Leakages in underground parking; Incomplete flooring work in lower

basement; Incomplete painting/white washing in

lower and upper basements; Evidence of water logging in the lower

basement up to 3 feet; and Two storied parking measuring 15293sqm had not been used during CWG-

2010.

Water logging mark at about 3 feetUnderground parking at JNS

17.6.4 Consultancy services for WADA laband administrative block

Consultancy work for construction of WADAand administrative block were routineconstruction activities, planning, designingand drawings work and could well behandled by CPWD through its CentralDesign Organisation (CDO). However, CPWDopted to hire consultants and awardedconsultancy contract at a cost of Rs.40 lakh.We noted that: While the consultancy contract for

detailed architectural and structuralplanning, designing, drawings, allinternal services etc., was awarded onlyin March 2007, the pre-qualificationsbids for construction work notifyingestimated cost of Rs. 24 crore assessedby CPWD had already been invited inFebruary 2007 indicating much of theplanning and designing work hadalready been completed departmentally.

The evaluation criteria was diluted threeday before the extended date ofsubmission of consultancy bid ongrounds of better participation ofconsultants. Against the original criteriaof 30 out of 40 marks in concept,appraisal and methodology and a totalof 80 out of 100 marks, the dilutedcriteria provided for scoring at least 25out of 40 marks in concept, appraisaland methodology and a total of 65 outof 100 marks to be eligible/ consideredfor financial evaluation. M/s Kothari andAssociates scored 26 marks in conceptand methodology and a total of 79.9marks. But for dilution of evaluationcriteria they were not eligible forfinancial evaluation.

The consultancy services were required tobe completed in 90 days with stipulated



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date of completion of 12 June 2007. We,however, noted: Drawings and write up were submitted

to MCD on 5 June 2007; Draft tender documents were submitted

in August 2007; Structural design and drawing were

submitted in November 2007; and GFCdrawing for upper floor of the

Administrative Block had not beensubmitted as of November 2007.

Due to delay in submission of estimates,tender documents etc. by the consultantthe work was awarded in September 2007,seven months after pre-qualificationprocess. Further, defective planning andcost estimates resulted in large deviationsof Rs.4.52 crore and extra items of Rs. 1.11crore.

Case Study: 17.2Recovery of income tax at the instance ofauditUnder provisions of the Section 194J ofIncome TaxAct, 1961, tax on technical andprofessional services is required to bededucted at source @ 10 percent. Duringaudit of CWG related projects undertakenby CPWD, we noted that deductions weremade at the rate of 2 percent. On the matterhaving been reported to Ministry of UrbanDevelopment in September 2009 CPWDreported (January 2011) recovery of Rs.1.6Scrore. However, recovery of Rs.S.30 lakhcould not be made due to closure ofcontracts. No recovery of penal interestfrom defaulting agencies and/or penaltyfrom authorities responsible for shortrecovery was reported. Correctness of up todate deductions, interest and penalty interms of the Income Tax Act would beverified in due course.

17.6.5 Construction of Road, Storm WaterDrains and RCCSeating Tiers ofWarm-up Area

This work was awarded to NKGInfrastructure Ltd. at their tendered cost ofRs. 21.02 crore", with stipulated date ofstart of July 2009 and completion byJanuary 2010. We found the followinginstances of unwarranted expenditure. M-30 grade, 80 mm thick inter locking

paver blocks", meant for heavyvehicular traffic, were irregularly laid inthe stadium on the pedestrian footpath.

M-30 grade interlocking paver block meantfor heavy traffic laid on footpath Grass pavers with green honey comb

panels, meant for distributing load fromvehicular and pedestrian traffic to thebase course below, and for minimisingthe grass and root compaction, werelaid in the parking area. However thesewere found lying on the surface, brokenand scattered, defeating the verypurpose of laying these pavers. Theexpenditure on the item was Rs.0.09crore (upto Sept. 2010)

22 0.06 percent below the estimated amount ofRs.21.04 crare

23 80mm thick GRC/FRC decorative



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Broken and scattered green honeycombpanels in parking areas

The work was an integral part of thefacilities to be provided during the games.Non availability of the same has defeatedthe purpose of the work.17.6.6 Construction of Sub-Station

building I, III, IV & undergroundwater tanks & pump rooms

This work was awarded to RamaConstruction Company at Rs. 7.41 crorewith stipulated date of completion asSeptember 2009.17.6.6.1 Unrealistic EstimateThe detailed estimate for the above workwas for Rs.8.83 crore. The work was

awarded to Rama Construction Company atthe negotiated amount of Rs.7.41 crore.Against this, the contractor had been paidRs. 15.10 crore by the eleventh RA bill,which is more than twice the originalamount. This was due to deviation inquantity and execution of extra items,which indicates that the estimates wereunrealistic.

17.6.7 Construction of Boundary Wall ofStadium Complex

Arora Construction Company was awardedthe above work for Rs.6.17 crore, whichwas 5.80 per cent above the estimated costof Rs. 5.83 crore.In this regard, the following was noticed:17.6.7.1 Extra expenditure incurred due to

lack of proper planningIn March 2010, CPWD was directed to fix a 6mm thick M.S. plate on both sides of theboundary wall to make it bullet proof(against the Delhi Police's original request ofa 2.8 mtr impenetrable brick boundary wall,which was turned down by the GoM). Bythis time, 90 percent of the work wasalready completed as per the originaldrawings

In its reply CPWD stated that there was nosuch provision even in highly securedpremises such as Parliament House,Rashtrapati Bhawan.In our opinion, ordinary, customary or usualmaterials of construction would haveturned out to be equally suitable and at thesame time would have been cost effectivealternatives to ensure that the boundarywall was secure and bullet proof. A case hasbeen worked out for brick boundary wallwith concertina coil which would have

Performance Audit Report on XIXCommonwealth Games (CWG-2010) 281


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served the same purpose and its cost wouldbe approximately Rs5 crore, which is muchlesser than the final gross amount of thiswork which is likely to exceed Rs. 16.00crore, (including the cost of originallydesigned walls and extra itemssubsequently included to meet securityrequirements) spent at the insistence of thesecurity agencies.17.6.7.2 Unwarranted Execution of WorkThe site was handed over to the contractorin a piecemeal manner. Throughout theexecution of the work, various authoritieskept inspecting the site and accordingly thedrawings were changed from time to time.Since an integrated approach was notadopted, work seems to have beenexecuted in an ad hoc manner.We found that the boundary wall betweenGate NO.9 and Gate No. 10 served no realpurpose. This was built as per initial plansbut abandoned subsequently to include theSAl building withing the JNScomplex. Theexpenditure incurred for this work, which isapproximately Rs.0.60 crore, was thuswasteful

Boundary wall betweenGate No.9 and Gate no. 10

17.6.7.3 Execution of Defective WorkCPWD had pointed out various pending/defective works to the contractor in a letterdated 11 October 2010. The contractor didnot take any action. A reminder in thisregard was sent to the contractor on 7January 2011. During our field visits to thesite on 13 January 2011, various defects inthe work of the JNSboundary wall werenoticed, which are depicted belowpictorially.

Unplastered Wall of JNS

Gap in MS Plate security cover



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Unfilled Gaps in boundary wallCPWD, in its reply, stated that the defectshad since been rectified.Further, CPWD recorded a completioncertificate in which detail of defects werenot recorded, and no payment on accountof defective work was withheld from thecontractor till the 13th R.A. Bill (the last billmade available to us).

17.6.8 Non utilisation of completedHostel/ Media AccommodationBlock

Unused Hostel BlockThe hostel/media accommodation blockwas completed in June 2010 at a cost ofRs.12.07 crare (as per payment made tillNovember 2010). The building was nothanded over to SAl till November 2010 andas such, the accommodation was not usedduring the Games.

17.7 Dr. Shyama Prasad Mukherjee Swimming Pool Complex

SPMukherjee Swimming Pool Complex



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17.7.1 IntroductionDr. Shyama Prasad Mukherjee SwimmingPool Complex (SPM), constructed in 1982for Asian Games, with facilities of twooutdoor and one indoor pools and seating,was planned to be upgraded and renovatedfor CWG 2010 with state of art facilities tomeet the international standards andconventions for hosting world class aquaticevent. The work involved demolition of themajor portion of existing infrastructure,including free standing pillars, andreconstruction of these facilities.The major work of construction of newinsulated metal sheet roof, alongwith roofsupporting structure, and its integrationwith the structure, was tendered as alumpsum contract". This work was awardedto Ahluwalia Contracts (India) Limited (ACIL)at the tendered cost of Rs.229.73 crore inDecember 2007, against an estimated costof Rs. 176 crores calculated in October2007. The main components of thesubsequently calculated justified cost wereintroduction of new items of work, changein CPOH25 from 10 percent to 15 percent,escalation in material costs, and introducingnew cost components e.g., additional costdue to compression of time, labour costs

24 Ina lump sum contract, contractors are required toquote a lump sum amount for completing the work inaccordance with the given designs, drawings,specification and functional requirements and shall haveno claim for any payment on account of deviations andvariations in quantity of any items or components of thework, unless they are authorized deviations from theparameters, drawings and specification contained in thetendered documents. Authorized variations areregulated by rates specified in contract for additions toor deductions from the lump sum amount. Item ratetenders, on the contrary, specify all possible items ofwork with accepted rates for regulating payments tocontractor. Authorized deviations, extra and substituteditems are regulated by general provision of contract

25 Contractor's profit and overheads

attributable to provisioning of labour hutsoff-site, labour transportation etc.We noted that in deviation of the spirit of alump sum contract, ACILwas allowed anumber of concessions.

17.7.2 Undue concessions to ACIl.The last date for submission of tenderswhich was notified as 16 November 2007,was extended four times upto 14 December2007. The estimates put to tender were Rs.176 crore, and the Ll bid of ACILwas Rs.229.73 crore. The difference in the bid fromthe estimates was partly justified by revisingthe CPOHfrom 10 percent to 15 percent,permitted interestingly on the same date byDG (Works), CPWD as the much extendedlast date to bid i.e. 14 December 2007. Theapproval of the Ministry of UrbanDevelopment for revision of CPOHwasreceived only in July 2008. In reply CPWDstated that the dates are coincidental.However, CPWD irregularly allowedenhanced COPHwithout the approval ofMinistry.22 extra items valuing Rs.28.10 crore hadbeen sanctioned despite these beingincluded in the lumpsum contract. Theseincluded the followingAdditional payment of Rs.4.17 crore hadbeen made for an item of work covered inthe original contract as detailed in CaseStudy 17.3.



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Case Study: 17.3Extra payment of Rs.4.17 crore for itemsof work already covered in the scope ofwork of lumpsum contract.Despite clear provisions for use ofstainless steel plates, bolts, nuts etc. inthe item ofgalvanized strands for stainless steelconnections in the drawings, technicalspecifications and notes below the itemin bill of quantity, CPWD proposed anextra item of stainless steel plates andbolts on the ground that word"stainless steel" had not beenmentioned in the nomenclature of theitem of work. Extra payment of Rs.5crore to ACIL for stainless steel platesand bolts was approved by thecompetent authority in February 2010.Payment of Rs.4.17 crore had beenmade to ACIL as of November 2010.After continued deliberations/discussions and reporting by us, CPWDagreed (December 2010) that the itemof stainless steel plates and bolts, etc.was part of the agreement item andnothing extra was payable and assuredmake recovery from ACIl.

Additional payment of Rs.2.16 crore hadbeen made by redefining substituteditems as extra items.

The quality of high cost items ofstainless steel railing @ Rs.23,SOOpermeter was increased from 40 m to1640 m.

17.7.3 Change of RoofAgreement for construction of newinsulated metal sheet roof alongwithsupporting structure and its integration withexisting structure, etc. included provisionfor 13060 sqm of galvalume profiled roofsheet as top layer. The eligibility criterianotified through press notice for prequalification of contractors included thecondition of satisfactory completion of atleast one work of insulated metal sheet roofwith roof area not less than 4000 sqm. Theevaluation committee of senior officersapproved five agencies after assessing theircompetence to complete the work. The hightendered rates of 36.04 per cent above theestimated cost for civil work was justified byCPWD on grounds of specialized piles job,steel profile sheet roof, indigenousconstruction using local material and thehigh degree of mechanisation, etc. Thesuccessful bidder was required to submitcredentials of the roofing associate forapproval of CPWD.ACIL submitted details of Multicolor SteelsIndia Pvt. Limited as their associate for roofwork. The entire work was stipulated to becompleted by 16 June 2009, but ACILintimated that they were not able to find asuitable vendor for this work in October2009, indicating loose control of CPWD onACIL. It was noticed in October 2009 thatMulticolor did not possess the technologyor machinery to provide the exteriorstanding seam roof profile as shown indrawings and specifications.Instead of executing the agreement item atthe risk and cost of ACIL, CPWD decided tosubstitute the item with Kalzip aluminiumroofing system, in a series of unduefinancial favours to ACIL, which also



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defeated the basic purpose of lump sumcontract. CaseStudy 17.4 refers.In addition, 81 items of work valuing Rs.14.86 crore were added subsequently asextra items of work as these were notenvisaged at the tendering stage.

Case Study: 17.4Failure of CPWD to enforce contractualremedies against contractorTwo contracts awarded by the CPWDfor construction of new insulated metalsheet roof along with supportingstructure etc. at Dr. S.P.M. SwimmingPool Complex and construction ofweightlifting auditorium with two tierunderground parking at JNS includedsimilar item of work "providing andfixing of double skin insulated roofingsystem comprising of seam profiledpermanently colour coated galvalume/zincalune steel" @ Rs.7850 per sqm.and Rs.2349 per sqm. In both cases, itwas the responsibility of the maincontractor to engage technicallycompetent and capable vendors for theroofing system.However, the vendors engaged bycontractors were found to beincompetent and incapable to providethe committed roofing system. Boththe contractors did not execute the itemof work and CPWD decided to provideKalzip roofing system in both thevenues. However, the same authoritiesin CPWD sanctioned variable rates ofRs.7316.44 per sqm. for weightliftingauditorium by treating the item as'substituted item' and Rs.9168.35 persqm. for Dr. S.P.M. Swimming Pool

Complex by treating the item as 'extraitem'.Instead of executing the agreementitems in both the cases at the risk andcost of the contractor under provisionsof the agreement, CPWD preferredextra payment of Rs.6.79 crore to thecontractors by substituting the originalitem.CPWD replied that in view of thetechnical responsibility of the entirebuilding being with the main contractor,resorting to getting the roof work doneindependentlyat the risk and cost of themain contractor did not appear to be aviable solution. However, in both thecases the Kalzip roofing system wasprovided by manufacturers of the Kalziproofing system/ their agent, and themain contractors had no role exceptpocketing unearned profits.

17.7.4 Defects in agree Scope of work provided contradictory

provisions in the agreement whereby asper provisions in Volume I of theagreement, the service building wascovered in the scope of work but as perprovisions in Volume II, it was excludedfrom the scope of work. On beingreported in audit, CPWD agreed not totreat the work as extra item.

17.7.5 Specifications not as per sportingrequirements

Sporting requirements notified by theOC through venue brief had not beenadhered to fully. There were deviationsin dimensions of swimming pool, divingpool and warm up pool as detailed inAnnexe 17.4.



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17.7.6 Overpayment of Rs.O.39 crore. As per the agreement, the beam

detector was required to be providedfor a range effective for 110 meters.CPWD accepted the contractor's viewthat all the beam detectors of approvedmakes were upto 100 meters range only.This item was substituted with beamdetectors of 100 meter range.

Against the provision for foreign makepool re-circulating pumps and boosterpumps, local make equipments wereprovided.

However, payment was made consideringthe rates available in the billing scheduleinstead of variation rates. This resulted inoverpayment of Rs.0.39 crore. On beingpointed out, CPWD assured adoption ofvariation rates.

17.7.7 Excess procurement ofsporting equipmentAgainst the requirement of 18 racing lanes,CPWD procured 29 racing lanes, incurringexcess expenditure of Rs.0.22 crore foradditional 11 racing lanes. Again, 20 of 32starting blocks required for swimming poolwere transferred by the OC to 5PM Complexand CPWD also procured 36 starting blocks,incurring avoidable expenditure of Rs.0.34crore.CPWD in its reply stated that theseprocurements were made as per OC'sguidelines for sports equipment. As such,procurement of excess equipment resultedin wasteful expenditure.

17.7.8 Supply of inferior hose pipes forfirefighting system

Hose reel used before games

Hose reel replaced after games

ACIL provided Power Max make hose pipesfor fire fighting system, instead of thecontractual requirement of Padmini/Gatemake hose pipe as per 15:12585. Instead ofrejecting the entire lot of pipes, CPWDallowed part payment and reported therequirement of replacement of hose pipesthrough the completion certificate. Theinferior quality hose pipes were replacedafter closure of CWG 2010.



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17.7.9 Execution of poor quality work

Poor quality of tiling work executed in the pool

During joint inspection of the venue on 25August 2010 we noted floor tiles ofcompetition pool, warm up pool and divingpool damaged/missing at many places.After having been pointed out in audit,CPWD reported replacement of these tilesthrough ACIL.

17.7.10 Execution of defective work

Digging work still in progress (Dec. 2010)

During physical inspection of the venue inDecember 2010{after CWG 2010), wenoticed that the work of digging work/roadof 6 feet depth and 4 feet width (approx.)from service building to stadium was stillbeing carried out ..

17.7.11 Lack of authenticity of completionof the work

The work of providing Integrated BuildingManagement System was awarded at a costof Rs.0.40 crore for completion by 7 January2010. Initially CPWD indicated the work as'work in progress' (December 2010) andsubsequently (February 2011) indicated thatthe work was completed in September 2010(February 2011).

17.7.12 Inadequate horticulture workAgainst the estimated requirement of 10432sqm of horticulture work, CPWD inflatedthe estimate to 15000 sqm on ad hoc basis.However, the actual quantityexecuted/developed was only 7810 sqm.,including grassing work in 2367.48 sqmarea.

17.8 Indira Gandhi StadiumComplex

17.8.1 IntroductionTable 17.7 shows the major works that wereexecuted at the Indira Gandhi Stadiumcomplex for CWG-2010:



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The proposal was initially to renovate theexisting open cycling velodrome but, afterconsidering the options of a partiallycovered velodrome with demountabletimber track between May 2007 andSeptember 2008, a decision was finallytaken by MYASto construct a fully coveredair conditioned velodrome with permanenttimber track.

As brought out in our Study Report, ofJuly 2009, this change in specificationfrom an open stadium to a fully air-conditioned Indoor Velodrome waslargely at the instance of theInternational Cycling Union (UCI).

This delay was also reflected in thefinalisation of the return venue brief inFebruary 2009, venue brief of which wassubmitted in November 2006, with

cascading changes in the succeedingmilestones. The major works were ofconstructing the stadium structure andlaying the timber cycling track.17.8.2.1 Selection of JMC Projects

(India) Ltd.JMC Projects (India) Ltd. was awarded thecontract of composite work for IndoorCycling Velodrome. We found that it did notfulfil the prescribed eligibility conditions aslisted below: The compliance with the condition thatthe agency should not have incurred any

loss for more than two years in the lastfive years was circumvented by a changein the accounting period in the year2004-0~6 (though it does not appear tohave been done specifically for thisproject) as indicated, below

Accounting Year -0.67rofit after Taxes 15.90 (11.57) (4.04).32 Clearly, an otherwise ineligible agencyqualified due to the adjustment in thefinancial statements and performance.

Inconsistent figures of liabilities wereprovided by JMC. In the first instance itindicated a liability of Rs. 1179.79 crorefor 33 works in progress as on 30 June2008, which was subsequently increasedto 66 works of Rs1734.36 crore as on 31March 2008. Simultaneously, in thetender documents for the contract forstructural retrofitting/repair and E&Mfor the gymnastics stadium in the samevenue, the liability as on 31 March 2008

26 Accepted by the ROC in June 2005

was indicated as Rs. 1378.12 crore for35 works. Such disparity in the figuresclearly establishes their unreliability.

JMC Projects (India) Ltd. emerged as thesuccessful bidder based on non-transparent practices. Taking advantage ofthe adjusted accounting period anddespite non-clarity on the quantum ofliabilities, it not only won the instantcontract but also the contract forstructural retrofitting/ repair and E&M ofthe gymnastics stadium. Incidentally, thesame contractor was found ineligiblewhile bidding for works in the MOCstadium.



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Separately, we found that for the award ofwork of construction of trap and skeet nos.4,5, 6 and underground tank at Dr. KarniSingh Shooting Range (KSSR)27,ix bidders,who responded, did not fulfil the specifiedcriteria of executing three similar works ofRs.3 crore each in the last five years. Thecondition was thereafter relaxed toexecution of similar works of Rs. 1 crore permonth, which enabled the shortlisting ofJMC Projects (India) Ltd. and SwadeshiConstruction Co. from among the 6respondents. The work was finally awardedto JMC Projects (India) Ltd. for Rs.4.75crore, being the lower bidder of the two ..This agency also could not complete thework as per the stipulated time. In addition,we found that since CPWD no longerincludes the clause pertaining to executionof works at the risk and cost of the originalcontractor in the event of unsatisfactoryperformance in its contracts, they have norecourse to recover Rs.0.20 crore from theoriginal contractor.

17.8.2.2 Change in the roof works CPWD identified Lloyd Insulations as the

agency which would execute the roofwork as a sub-agency of the maincontractor. JMC indicated Rs.2.99 croreas the cost of this work. We found thatthe work was finally executed by BemoRoof System, since Llyod Insulationsfailed to execute the work. Till date, Rs.4.48 crore has been paid for the work.

It is a clear indication that CPWD and itsdesign consultant (STUP),could not assessthe complexity of the work, and such

27 This work was initially included in the scope of work ofEra Infra Engineering Lid., the main contractor forconstruction of KSSR. InAugust 2009, it was taken awayfrom it, due to its failure to complete the work in time.

change in the agency mid-course wouldinevitably lead to extra costs.

17.8.2.3 Deviations in execution of PAsystem works

There were astronomical increases rangingfrom 100 to 1800 per cent in the quantitiesof cables, conduits and hardware itemsamounting to Rs. 1.51 crore stated to beconsumed in execution of the work.

17.8.2.4 Award of work for Timber TrackWe found that the competition for thespecialised work of laying permanenttimber track for the velodrome was limitedto Indian furniture contractors inassociation with an international trackdesign and construction expert. It appearsparticularly strange that considering thelack of domestic experience and complexityof the task, CPWD chose to limit the Indianpartner to furniture contractors, rather thanthose associated either with construction orthe sports industry. No attempt was madeto float international tenders, despite thecompelling need for association of aninternational expert. Further, the eligibilitycriteria regarding similar works andturnover were also diluted.The contract was finally awarded to ComfortNet Traders (India) Pvt. Ltd. at a cost of Rs.17.45 crore from among three bidders, anagency that had supplied chairs at variousvenues in

CAG's CWG Audit Report - Chapter - 17 (2011)

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