Chandigarh: 2 decades later, MC yet to collect ₹32cr from admn, reveals audit

The Comptroller and Auditor General of India (CAG), in a report, has stated that the Chandigarh Municipal Corporation failed to collect ₹32 crore as compensation from the administration for the land acquired from the Maloya gram panchayat over two decades ago.

The revelation comes amid the civic body’s long-standing fund crunch, which has stalled development projects for nearly a year and delayed staff salaries for the past three months.

According to the report, the Chandigarh administration transferred 23 villages in phases (1, 9 and then 13 villages) to the Chandigarh Municipal Corporation (MC) between 1996 and 2018. With this, the MC became responsible for developing these villages and generating revenue through measures such as levying property tax, approving building plans and receiving compensation for the acquired land. The report mentioned that during a check of the MC records, it was found that the MC never claimed ₹32 crore for the land acquired from Maloya gram panchayat.

The dates of possession and demarcation of the said land could not be ascertained from MC records. As a result, from 1996 to 2024, the MC not only failed to collect the compensation but also did not determine the exact amount payable for the acquired land, it stated.

The report also revealed that correspondence between the land acquisition officer and the MC, which began in 2023, indicated that the MC was entitled to collect approximately ₹32 crore (excluding interest) as compensation for the land acquired in Maloya village alone.

Since the MC didn’t approach the administration to collect the amount, the land acquisition officer deposited ₹7.05 crore in the administration’s Punjab National Bank (PNB) account in 2004. According to the CAG report, this amount would have grown to over ₹20 crore by now (considering interest) over the past 20 years. The remaining amount was deposited in court by the land acquisition officer as it is mandatory to do so after a certain period.

At present, the principal amount (excluding interest) of approximately ₹32 crore remains deposited in the court ( ₹25 crore) and the bank ( ₹7 crore). The MC has made no effort to claim it in the past 28 years. Despite repeated attempts, MC commissioner Amit Kumar did not respond to calls.

The cash-strapped MC, which is not being able to pay salaries on time, is stretched thin in terms of meeting other financial obligations as well, including pensions, water and electricity bills, maintenance works and fuel expenses. Development projects remain stalled since May 2024 amid the civic body’s struggle to meet monthly liabilities.