Indore: The Central Vigilance Commission (CVC) has blown lid off a scam took place during the implementation of Group V construction project undertaken by Indian Institute of Management Indore for its expansion.

A team of CVC that visited the institute a few months back, in its report revealed that general financial rules and government norms were blatantly violated by IIM Indore for in-house constructions and that its decisions resulted in poor quality standards and cost overruns.

The report states that the institute appointed architectural consultant in arbitrary manner, revised estimated cost so that a particular builder gets the contract and made unauthentic and fallacious entries in site registers allegedly to cover-up the scam.

Quality compromised for money 

• Minimum cement content specified for M25 grade concrete design mix was 410 kg/cum of concrete however concreting work being executed at site was having cement content of 365 kg/cum of concrete. The contractor saves Rs 31.5 lakh.
• The contractor saves over Rs 12 lakh by not laying steel in AAC block masonry work.
• Thickness of marble stone was found lesser than the approved one. 

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Benefits provided to architectural consultant

Stating that selection of architectural consultant was made on the basis of mere presentation of design, the CVC said that the appointment was arbitrary and against the guidelines of Ministry of Finance.

M/s Kothari Associates Pvt Ltd (KAPT) was selected as its presentation came “closest to the requirements of the institute. No deliberations/reasons for selection of the firm were recorded.

Competitive financial bids were not called rather fee was pre-fixed @5% of the cost of the project as per the Council of Architecture (CoA) guidelines thereby causing huge loss to the exchequer.

“It is pertinent to note that these guidelines have no sanctity and they are neither binding on the employer nor architect community attach any importance to this scale of fee. Architects, when asked to put competitive bids, invariable offer their services at much lower fee than this scale of fee,” the CVC said.

In the EOI and letter of intent fee was fixed as per CoA scale of charges. However, while framing the agreement professional fee was deliberately kept as “5% of actual total cost of the project” against “5% on the cost of work assigned” as mentioned in CoA scale of charges as an ulterior motive to give undue financial benefits to the consultant. Even if one considers CoA scale of charges/fee as acceptable, professional fees paid should have been “2.5% of the cost of work assigned” as site area ranges between 2.5-5 hectares. Considering this, fees paid till date come out to Rs 93.54 lakh only whereas the institute has already paid Rs 4.35 crore causing a loss of Rs 3.41 crore to the exchequer.

In the agreement, the consultant fee was not fixed but made to vary with the amount of work executed. Further scope of work mentioned in EOI was considerable increased from estimated Rs 40 crore to Rs 90 crore by adding several new structures viz Skywalk with Clock Tower, Faculty Residences, etc thereby passing of undue benefit to the consultant