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Commonwealth Games 2010: Corruption And Irregularities

While the world had an eye on India, several concerns over the preparations and administration were raised.

These included budget overruns, bridges falling apart, roads dug out, delays in construction and infrastructural compromises of the CWG Game Village, prominent athletes pulling out. Shivaji Stadium, which was allotted for some events been removed as a venue due to poor speed of renovation.

The preparations that had to be finished two years prior to the Games weren't over till even a month before[2]. The inadequacy of preparations and pilferage of funds resulted in the development of India's the biggest scams- The CWG Scam 2010.

Corruption And Irregularities

The scam contributed a pilferage of an astounding 70,000 crores for the Government. The twelve day mega event in Delhi involved a series of corrupt practices and transactions. There was a serious miscarriage of responsibility and ethics from the administration. This included the administration choosing inflammatory rates of contracts and disqualifying companies offering better deals for inexplicable purposes.

Head officials of the CWG and the architects of the scam such as Suresh Kalmadi, Lalit Bhanot, Anil Kumar Khanna were indicted by the CBI for varying levels of corruption such as forgery, criminal conspiracy and corruption[3]. This gross miscarriage of office resulted in worldwide embarrassment for the nation.

The day the games got concluded, a massive uproar in the public and in the political sphere forced the government to designate a special committee under Mr V.K Shunglu and other state agencies like CBI, Central Vigilance Commission (CVC), Enforcement Directorate to investigate the administration and governance of the Commonwealth Games[4]. "A total of 53 corruption cases were being examined by the CVC. While, 13 were referred to CBI for further investigation and 12 were closed.[5]

V.K Shunglu Committee Report

Some of the key finding from over five reports, which looks into organising and conduct of CWG-2010 are as under:

The Host City Contract was acceded without due reflection. It was based on a false pretext which was 'revenue neutrality'. A proposed amount of Rs 30,000 crores were duly secured from the Government between 2003-2010. The process of securing the amount even continued at a position where it became clear that the games would be financial burden on the State.
Once, the CWG bid was accepted a period of seven year was available for the preparation of the games. Under the report it is highlighted that three years were wasted on peripheral activities while only in the last four years preparation activities picked up.
Lack of a budgetary ceiling resulted in an increase in expenditure and it was unclear whether Ministry of Youth Affairs Sports possessed the authority to facilitate the activities and restrain the entities governing CWG games.
The role assigned by the CWG President, CGF & CEO was rather arbitral and not conductive to proper management.
The decision to conduct the games through a private not for profit society was deemed as an 'error of judgement' in the report.
The Governance mechanism to oversight the CWG became a mammoth overtask and the facility function task was often abused by entities it was meant to assist.
The report also highlights that the Group of Ministries (GOM) during 2005-2009 were rather supportive of the functions of the Organising Committee (OC) and in certain matters the Group of Ministry often over looked activities of the OC which belonged under the GOM ambit.
Project were delayed and completed under their own time frame. The GOM did not seem to intervene though it's chairman was the Minister for Urban Development[6].

The issue raised by the Shunglu Committee[7] reflect the callous attitude of the state that surely paved role for the development of the scam. As it can be reflected that a window of seven years was provided for the preparation of the 2010 games, and in this time frame it was only the last few years where authorities really paced things up, which naturally led to various emergency decisions compromising cost & quality.

I feel the delay in the project which was a consequence of poor administrative functioning was chiefly the integral reason for corruptive practices since a vast amount of projects were completed in the penultimate stages, it became very difficult to maintain parallel checks and balances with the OC.

At a point of time the priority of GOM just became timely completion of projects to avoid global humiliation, and this is where the heads of the OC took advantages. A lack of budget and a ceiling cap aided the cause, highlighting the irresponsibility on the Indian government shamelessly wasting the hard-earned money through poor planning and administration.

It can be reflected that almost every contract in the CWG from toilet papers to constructional costs were all approved exorbitant costs by misleading or compromising the approving authorities. Incorrect reporting and lack of coordination also became a standard practice as reflected in the Shunglu Committee report .

Whether there was an abuse of discretion on the part of the Organising Committee while managing the affairs of the Common wealth games?

CWG Scam: Leading Case on Instances of Corruption
Time Scoring Result (TSR) Case: Contract awarded before applied.

The general rule for awarding contracts involved the practice of biding. Where authorities invite bids in form of tenders, and companies fairly are allowed to make a bid in lieu of which the most rewarding and appropriate bid is chosen. In the current case, the TSR bid was arbitrarily awarded to Swiss Timing at exorbitant rates contrary to a reputed Spanish company (ML Spain) which costed less than half quoted by Swiss timings.

ML Spain was "fraudulently disqualified" at the pre-qualification stage leading to a "single tender situation". Since there was a single tender the members of the Organising Committee and Swiss Timing increased the bid at 1500 million, where the difference in the money was conveniently misappropriated by Mr. Kalmadi and his allies. Most importantly, they the bid was given to Swiss Timing a month before they even opened the bidding to others, essentially, quashing all other legitimate bids. Suresh Kalmadi the organising committee chief was convicted under Section 120 B and 420 of the Indian Penal Code for conspiring with the entities of Swiss Timing[8].
Irregularities in the Organisation Committee
The internal functioning of the Organising Committee especially the internal decision making and appointment of officials has been questionable. It has been showcased through the 'Public Accounts Committee report in its XIX Commonwealth report', that a clear nexus of abuse of discretionary powers has been conferred on the organising members.

For instance, the OC breached its duty to act in public interest by formulating an internal committee subjected degrees of biasness, contrary to the rules formulated by the government. It can be observed that the joint directors RK Sancheti and NP Singh were close aids of Mr. Kalmadi who were arbitrarily appointed him without any reasoning or mandated qualifications . Whereas, the secretary general Mr. Lalit Bhanot was often known as Mr. Kalmadi's right hand man played a pivotal role in the TSR scam case. Mr Lalit Bhanot further appointed his sons and sisters as paid consultants to the mega project without the applicable requisites[9].

Apart from the internal composition the OC, also irregularly rewarded sensitive contracts at exorbitant rates in an arbitrary fashion. The other irregularity of the internal committee could be highlighted under the documentation of the OC. There existed several deficiencies in the payment processes as there were over payments, payment without approved contracts an payments in foreign currencies for Indian contracts.

The OC members inapplicably bypassed all procedures for safeguards for instance vetting of documents or taking legal advice[10]. This led in an exposure of a lot of tax liabilities on the government only because of the ignorance of OC members towards their duties.

These events highlight the corrupt practices adopted by the OC. The head members, on numerous occasions as mentioned did not heed to the procedure laid by government agencies and therefore their actions were ultra vires to the instruction so provided. The fact that the head members of the OC were chosen on account of their governmental experiences, which provided a reasonable expectation of fairness and trustworthiness.

However to the contrary their action by the facts were against the equitable doctrine; where the government legitimately expects the organising body to adhere to the procedural instruction so determined.
Financial Irregularities
As reported earlier several contracts of the Commonwealth Games 2010 were inflated at enormous rates. The audit committee reports highlight that the president of the CWG, Suresh Kalmadi used "shadowy off-shore firms, forged emails, inexplicable payments to bogus companies and inflated bills ï¿½ for every purchase of item."[11] The Auditors further claim that the OC not only deeply flawed and biased but was selective in awarding contracts to manufacturers and retailers for sporting goods and services.[12]

The Comptroller and Auditor General report asserted that the admirative authorities inflated the penultimate costs of the games to sixteen times to that which was originally proposed. The powers so, deemed by the administrative authority were not under the limits and hence could be called as "abuse of discretionary powers."[13]

Similar to the TSR case an another example of over-invoicing can be reflected in the tender for the supply of VIP chairs and media chairs required for five destinations. CAG, in its report found out that while tender was issued to Superior Furniture, other bids were disqualified on unreasonable grounds. The report also showcased that many furniture items were recalculated and inflated that created an extra expenditure of Rs3.66 crores.

Apart from awarding tender arbitrarily, on several accounts the authorities also deliberately inflated the costing rates and area specifications to increase the costing rate. This can be seen, in a horticulture contracts where the area of work was 10432 sqms however the same was increased to 15000 sqms, which escalated the cost. The report by the CAG report proves the OC and administrative authority had mala fide intention and motives to inflate the invoices and prices to misappropriate the money of hardworking taxpayers.

The Thayagaraj stadium case is an instrumental and key instant of proving personal gains of the authority. While, the standard practice of perusing constructional tenders is under the compliance of Delhi Schedule of Rates the rate of tendering in the case of Thayagaraj stadium was not pursued only. The CAG found numerous items been inflated of costs without detailed invoices or estimates. It also highlighted that on number of occasions items with higher costs were selected again with no reasonable justification for forgoing the lower rate items[14].

Thus, from all these similar cases, It can primarily be said that the statutory power exercised by the administrative authorities in CWG were beyond the ambit of the powers granted to them by legislation. Therefore, it can be concluded that the administration had an improper purpose and malafide intentions, where they abused the broad discretionary power given to the them.

Conclusion
While, in a subsequent case at the Delhi High Court, perhaps changed the dynamics of the CWG case. It held that organising committee comes under the scope of Right to Information though not coming under the definition of Article 12 of the Indian Constitution. The High Court ruled that since it was the state which provided funds to finance the activities to the organising committee, therefore it was subjected to RTI.

This proved to be a milestone and boost to expose the CWG scam. It can also be evident that the Commonwealth Scam unlike other scams was a culmination of several scams ranging from toilet papers to infrastructural projects.

This multiple level of scam at such a high level depicts the administrative failures by the Indian Government. This scam not only shamed India at a global level but also saw the hard earned money of tax payers go into the drain. This makes me conclude that apart from litigation there surely arises a need for an effective redressal mechanism for every small administrative failure to ensure the natural principals of justice.

End-Notes:

Ayush Verma, Commonwealth Games scam ï¿½ a legal timeline,
Ibid
Ibid
CWG: Probe panel to report in 3 months. The Times of India. 16 October 2010..
CVC "Okays Closure of 12 CWG Graft Related Cases". The Outlook India.
XIX Commonwealth Games, 2010,Public Account Committee Seventy fourth report, https://eparlib.nic.in/bitstream/123456789/65711/1/16_Public_Accounts_74.pdf
ibid
Outlook India: 'CBI Chargesheet in One More CWG Scam Case', August, 2012. <â€‹https://web.archive.org/web/20120818015315/http://news.outlookindia.com/items.aspx?artid=772380â€‹>
https://economictimes.indiatimes.com/news/politics-and-nation/cwg-scam-everyones-family-in-oc/articleshow/66 48346.cms?from=mdr
CAG Report, p 97
Commonwealth Games | New Delhi | India Corruption"â€‹. Globalpost.com. Retrieved 22 September 2010.
XIX Commonwealth Games, 2010, Public Account Committee Seventy fourth report, pg. 17, https://eparlib.nic.in/bitstream/123456789/65711/1/16_Public_Accounts_74.pdf
CAG XIX Commonwealth Games, 2010 Report 11 of 2011
Ibid.