CAG pulls up Army Ordnance Corps for delay in procurement orders

New Delhi: The Army Ordnance Corps has been pulled up by the Comptroller and Auditor General (CAG) for instances of delays in placing procurement orders, resulting in extra expenditure. CAG has said the delays in placing orders and materialisation of supplies in case of critical items was an "inherent" problem affecting the operational preparedness of the Army.

In a press release it further said, "Against the prescribed time frame of 23 weeks in Defence Procurement Manual, delay of 13 to 301 weeks was noticed in certain supply orders. The delays were mainly in obtaining acceptance of necessity and completing the tendering process within the bid validity period."

"Against the supply orders/indents placed on Ordnance Factories, Defence Public Sector Undertakings and other vendors, supply orders valuing more than Rs 700 crore were outstanding beyond the delivery period and awaiting completion for the last one to 19 years," it added.

The report has been tabled in the Lok Sabha.

The Army Ordnance Corps (AOC) is responsible for providing material and logistics support to the Indian Army during war and peace. The inventory management functions of AOC primarily involve provisioning, receipt, storage, preservation, accounting, stocktaking and issue of ordnance stores.

The CAG also cited cases of extra expenditure due to failure to accept the tender within the prescribed period and procurement at higher rates. It said, "Failure to accept the tender within the validity period in one case led to the retendering and consequent placement of supply orders at an extra expenditure of Rs 6.75 crore."

According to CAG, there were instances of rates in central procurements at central depots being higher than their local purchases rates made within the last one to six months resulting in an extra expenditure of Rs 4.36 crore.

The CAG said procurement agencies did not utilise the provision of the repeat order/option clause and instead placed fresh supply orders at rates higher than the earlier ones, resulting in an extra expenditure of Rs 3.89 crore.

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