CAG pulls up KoPT over port-handling affairs

Written by Indronil Roychowdhury | Kolkata | Updated: Aug 12 2013, 11:08am hrs
The comptroller & auditor general (CAG) has pulled up the Kolkata Port Trust (KoPT) for showing favouritism attitude to unauthorised operators. This has led to a huge loss of revenue for the countrys only riverine major port.

CAG report of 2011-12 has pointed out that exporters and importers appointed private handling agents, who did most of the onshore handling at Haldia Dock Complex (HDC), the main cargo handling arm of KoPT. The port had no control over this handling and a major share of the ports revenue from cargo handling related charges were carried away by private agencies without paying any royalty, the report said.

KoPTs administrative officer Ramakant Burman, who blew the whistle against irregularity, said this was true for all major ports in the country.

According to the Indian Ports Association (IPA) data, the countrys major ports handled 546 million tonne in FY13, of which 160 mt have been manually handled by unauthorised agents and stevedores, who are not entitled to carry out onshore operations. Such agents havent shared any revenue with the ports so revenue of at least 160 mt has gone to the pockets of agencies handling without valid licence.

Every port is supposed to engage handling contractors under section 42 of the Major Port Trust Act, 1963, wherein the contractor has to share revenue with the port. But none of the contractors have been engaged under this Act. Section 48 of the Major Port Trust Act calls for fixing handling charges by the tariff authority for major port (TAMP) but the contractors fix charges for themselves.

Average charges realised by such contractors are Rs 250 per tonne, which means there is a drainage of at least Rs 4,000 crore every year from the system, estimated Burman.

Sitaram Yechury-led parliamentary standing committee on transport tourism & culture has already submitted a report in Parliament on May 3 and the ministry has formed a committee under DG shipping to look into the issue, Trinamool MP and panel member Kunal Ghosh told FE. Companies like Ripley, run by Trinamool biggie like Swapan Sadhan Bose and his son Srinjoy Bose, a Rajya Sabha MP, have only handling agent licence for operations in Haldia and take away R450-500-crore revenue every year paying only an annual licence fee of R5,450.

According to a Calcutta High Court order, handling agent licence has no legitimacy, but port authorities allowed Ripley to do onshore operation that accounts for 75% of the ports total operation.

The shipping ministry in a letter (dated June 13, letter no: PD- 13014/ 2/ 2013 KoPT) available with FE had advised the port to formulate a scheme for collection of royalty user fee from cargo handling agents based on an open and transparent auction process. But the port is sitting on the letter, said an official.

The CAG report pointed out that KoPT authorities favoured unauthorised agencies and in turn jeopardised mechanical and efficient operations. The port, in turn, lost opportunities of handling 36.18 lakh tonne more cargo and failed to earn R87.68 crore worth of additional revenue in FY12.

Haldia Bulk Terminal (HBT), a joint venture of ABG and LDA of France, had to pull out mechanical operations from the port as authorities were not allotting it enough cargo. It diverted the major share of cargo to unauthorised contractors handling manually.

The CAG report said, HDC had lost the opportunity of handling 36.18 lakh tonne more cargo at HBT for not allotting more cargo to its berths. This has deprived the port of earning additional revenue. HBT was given berths 2 and 8 for mechanical operation.

CAG says, As per clause 7.7 of the contract, the successful tender was to undertake the on-board and onshore work with equipment and manpower round the clock on all the days. According to clause 7.8 (a), the tender had to ensure handling a minimum-level performance of 20,000 tonne of cargo per ship berth day at each berth. They said two clauses indicated that about 6 lakh tonne would have been handled at each of the said 2 berths per month.