JUSTICE WADHWA COMMITTEE

 

ON

 

PUBLIC DISTRIBUTION SYSTEM

 

 

 

 

REPORT

 

ON

 

THE STATE OF UTTARAKHAND

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INDEX

 

 

SL.

NO.

 

PARTICULARS

PAGE

A.

Preface

   1-4

B.

Broad Overview

i-xvii

1.

Introduction

            

1-5

2.

Legal Regime governing the Public Distribution System

 

6-25

3.

 

I.

II.

 

III

IV

V

VI

VII

Public Distribution System in the State

 

General Set-up

Entities involved in the Supply of Food Grains to Consumers

Procedure of Procurement of Food Grain by Department

Wholesale Distribution

Observation/Inferences

Office of the District Supply Office

Diversion

 

26-62

 

26

 

26-30

30-31

31-47

48-49

50-56

56-62

 

4.

 

I.

II.

III.

IV.

Retail Distribution (Fair Price Shops)

 

Mode of Appointment of Fair Price Shop

Viability

Functioning of the Fair Price Shop

Disbursement of Food Grains to the Consumers

 

63-97

 

63-70

70-82

82-87

87-97

5

Transportation

 

98-105

6.

 

 

Vigilance Mechanism, Ombudsman and Enforcement

 

 

106-119

7.

Identification of Beneficiaries

 

120-130

 

8.

Computerization

 

131-135

9.

Recommendations

136-145

 

 

 

 

 

 

 

 

 

 

 

PREFACE

 

 

In the matter:

 

                  Writ Petition (C) No. 196/2001 – People’s Union for Civil

                   Liberties  V/S Union of  India  and Ors.

 

 

1.       Hon’ble Supreme Court of India by Order dated 12.7.2006 in the aforesaid Writ Petition constituted a Committee to be headed by me to look into the maladies affecting the proper functioning of the Public Distribution System (PDS) and to suggest remedial measures.  

 

2.       Hon’ble Court’s direction was initially given for the Government of Delhi to be followed on an all India basis.

 

3.       Committee submitted report on Delhi on 21.8.2007. By order dated 10.1.2008, Hon’ble Court while accepting the report, directed the Committee to do the similar exercise in terms of earlier order for the entire country.

 

4.       Scope of the task assigned to the Committee thus having been enlarged, the Committee projected to the Department of Food & Public Distribution, additional requirements of staff, space and delegation of financial powers for its smooth functioning.  The Department dilly dallied and did not meet the requirements.  The Committee had to approach the Hon’ble Court time and again.  It was only after a peremptory Order dated 25.8.2008 passed by the Hon’ble Court that the Department started taking steps for creating necessary infrastructure.  It was only thereafter that the Committee could start functioning in right earnest.  The Hon’ble Court extended the time for submitting the report   till April 2009.

 

5.       The Committee is submitting report of the State of Uttrakhand.

 

6.       No one   has doubted the utility of PDS being the need for supply of food grains to the poor of the country at affordable rates.  Procurement and distribution of food grains is a huge and gigantic task but the whole system is built on corruption. There are more leakages and maladministration and benefits to the poor are low.  Inefficiency and corruption has made PDS corrupt at several levels.  The system lacks transparency, accountability, monitoring and enforcing.  Survey is not being conducted regularly and properly, with the result people Above Poverty Line (APL) have been issued Below Poverty Line (BPL) cards and those eligible for BPL cards have been ignored.  Bogus cards are in abundance.  Immediate measures are required to stop the diversion of food grains.  Delivery systems under the PDS have to be improved so that the real beneficiary gets its due entitlement at fixed price, fixed quantity, fixed time and wholesome quality.  Innovative methods are required to improve the system.  The whole system has to be totally revamped and modern technology would appear to be the only answer.

 

7.                 Committee has suggested that in order to combat corruption and strengthening PDS there has to be zero tolerance approach.

 

8.                 Based on the work done by the Committee and in compliance with the Hon’ble Court’s orders, a detailed report covering all issues tasked to the Committee is being submitted.   The first part of the report is a Broad Overview.  The report is then divided into 9 Chapters. Last Chapter contains the recommendations.

9.       Uttrakhand has total area of 53,484 Sq.Kms, out of which about 93% of this geographical area is hilly (mountainous).  Garhwal and Kumaon are two separate regions of the State.  Committee made separate visits to these two regions.    Problem of distribution of foodgrains in hilly areas is certainly different than what it is in the plains.  Some of the areas in the State become inaccessible during winter and monsoon because of heavy snowfall and rain on the higher regions.  To make available foodgrains in these areas is certainly difficult task.  In these areas foodgrains is transported by road, mules and even head loads.  Rates of transport by road (motor vehicle), mules (khhachars) and headload are fixed by District magistrate concerned.  The cost of transportation of foodgrains in rural areas is unfortunately added to the cost of the subsidized foodgrains.  Committee has recommended free door step delivery of various food stuffs at Fair Price Shops.  

 

10      Task before the Committee has been quite stupendous particularly considering the time schedule.  In this task Legal Team headed by Mr. Dayan Krishnan and Mr. Dinesh Dayal, Advocates and assisted by  Ms. Neeru Vaid, Mr. Gautam Narayan,  T.V.S. Raghvandra Sreyas Ms. Meenakshi Chauhan and Mr. Anant Garg.  Mr. Aman R. Nath  and Ms. Harjit Kaur were engaged by the Committee  as local lawyers at Dehradun and they also rendered a great deal of assistance

 

11.             For the Committee to complete its task, got full support and cooperation from the officers of the State of Uttrakhand, particularly Dr. Ranveer Singh, Secretary, Food & Supply Department, Mr. Kunwar Singh, Additional Secretary, F&CS, Dr. A.K. Sinha, General Manager, F.C.I. and his team of officials, Dr. Rakesh Kumar, District Magistrate Dehradun, Shri Anand Wardhan, District Magistrate Haridwar, Mr. Sachin Kurvey, District Magistrate Rudraprayag, Mrs. Saujanya, District Magistrate Tehri, Shri Sailesh Badauni, District Magistrate,  Pauri, Ms. Nidhimani Tripathi, District Magistrate Almora, Dr. P.S. Gusain, District Magistrate Pithoragarh and Mr. A.S. Nayal, District Magistrate Champawat.  The Committee also records its appreciation of the help rendered by the officers of FCI, District Supply Officers of the concerned districts visited by the Committee. Mr. Prem Pawar, Marketing Officer accompanied the Committee during its visit to Kumaon region of the State.

 

12.             Mr. S.C. Rawal, former Registrar of Delhi High
Court performed the functions of the Secretary to the Committee.  He handled all the correspondence of the Committee and looked after the requirements of the Legal   Team attached to the Committee.

 

13.              Mr. K.K. Mittal, Dy. Registrar (equivalent to Director in Central Government) helped the Committee in going through the draft reports.  He also looked after the administration and staff attached to the Committee and handled correspondence with the Department of Food & Public Distribution, Government of India.

 

14.             There may be some overlapping on   various points in the report and that is so because an attempt was made to make each chapter self-contained.  It is also possible that there might have been some inadvertent errors which may have crept in the report but the whole report is  an attempt to present the correct picture of the ground realities keeping in view the directions  of the Hon’ble Court.

    

15.             The sum and substance of the recommendations are given in Chapter 9 of the report.

 

 

(Justice D.P. Wadhwa)

Chairman

Central Vigilance Committee on

Public Distribution System

Delhi

Dated: 23.3.2009

 

 

 

 

 

 

 

 

 

 

 

OVERVIEW

 

 

1.                 This report examines the functioning of the Public Distribution System in the State of Uttrakhand.  The State of Uttrakhand came into existence on 9.11.2000 as 27th State of Union of India. Because of the peculiar geographic conditions of the State of Uttrakhand, problems of PDS are different.  Taking into consideration the peculiar demographic situation of the State, the Department of Food & Supplies, and Government of Uttrakhand has adopted different methodology for different regions in respect of the general administration of PDS, mode of appointment of Licencees for Fair Price Shops, fixation of the sale price of PDS items, transportation of food grains and vigilance mechanism.

 

2.                 The State of Uttrakhand is divided in two regions- Garhwal and Kumaon.  There are 13 districts in the State.  The Committee visited Dehradun, Uttarkashi, Tehri and Rudra Prayag districts in Garhwal region and Nanital, Almora, Pithoragarh and Champawat districts in Kumaon region.  In all these districts the District Magistrates appeared to be abysmally ignorant of the provisions of the PDS Control Order, 2001, Uttranchal Scheduled Commodities Distribution Order, 2003 and the orders passed by the Supreme Court.

 

3.                 The report of the Committee discusses in detail various aspects of Public Distribution System including problems, suggestions and versions of the public and officials.   The Committee has given suggestions to improve these aspects.  The Committee observed the following irregularitiess in the Public Distribution System in the state of Uttrakhand:

                    i.                        Transportation of food grains in inaccessible areas especially the advance allocation is not made in time.

                  ii.                        BPL beneficiaries are not getting their full quota of food grain.

                iii.                        There are large inclusion and exclusion errors in the BPL category.

                iv.                        Food grains are sold at excessive prices at the Fair Price Shops

                  v.                        Irregular timing of the Fair Price Shop.

                vi.                        Non-existence of Vigilance and Enforcement mechanism.

              vii.                        Non-observance of PDS Control Order, 2001 and Uttranchal Scheduled Commodities Distribution Order, 2003 and directions of the Supreme Court.

            viii.                        No check on issue of APL Cards.  Central Government does not issue APL quota considering the number of cards.

                ix.                        Delay in lifting of food grain

                  x.                        Leakages and diversion.

                xi.                        Political interference.

 

Public Distribution in Uttrankhand:-

 

4.                 The Department of Food & Civil Supplies, Government of Uttrakhand manages the Public Distribution System. Marketing Wing has been entrusted with the responsibilities for procuring the food grains for both the Central pool and State pool. Marketing Wing maintains the base godowns of the entire state.  On the other hand internal Block godowns are maintained by District Supply Officer (DSO).

 

5.                 The State of Uttrakhand is divided into 13 districts. In all there are 8,413 Fair Price Shops with 22, 80,560 ration cards of all categories[1].

 

6.                 The Uttranchal Scheduled Commodities Distribution Order, 2003 has been issued by the State Govt. in exercise of the powers conferred by Section 3 of Essential Commodities Act, 1955 for the purpose of maintaining supplies of food grains and other essential commodities and for securing equitable distribution of essential commodities at Fair Price Shops in the State of Uttrakhand.

 

Allotment of Licence:

 

7.                 There is a separate procedure for allotment for Fair Price Shops in Rural and Urban areas. In rural areas, Gram Sabha in an open meeting decides as to whether a fair price shop is required in that village or not.  The assistant BDO acts as observer in the meeting.  The Gram Sabha decides and nominates the person for running the fair price shop. Once a nominee is selected, then the said candidate approaches the Sarpanch and Assistant BDO to get necessary certificates. The papers are then forwarded to the BDO who forwards the same to DSO. The DSO finally checks the character certificate and financial situation of the person so recommended. The DSO then forwards it to the District Magistrate who passes the order and also collects a deposit of Rs. 250/-  as a security for the licence.

 

8.                 In urban areas, a vacancy of opening of a new fair price shop is normally notified if there are 4000 units .Once a vacancy of a fair price shop is determined, an advertisement is published in the newspaper inviting applications. Once all the applications are received the circle supply inspector makes an inspection and on the basis of the report some candidates are selected to appear before the Selection Committee. The Selection Committee consists of the following

                           i.            District Supply Officer,

                         ii.            District Magistrate/ Additional Magistrate,

                        iii.            Chief Development Officer

                       iv.            One nominee of the Revenue department.

 

 

9.                 Once the Selection Committee makes its recommendation, the same is forwarded to the DSO who checks the financial status and character of the candidate thereafter the same is forwarded to the District Magistrate, who passes the order and collects a deposit of Rs. 1000/- as security. 

 

10.              Normally a shop is allotted if there are 2000 units, i.e. 400 ration cards but this limit is raised to 4000 units i.e. 800 ration cards in case the allottee is a cooperative society.  It was observed by the Committee that there is too much political interference in issuance of licences to the Fair Price Shops both in rural and urban areas.

 

11.             Once the licence is issued, there is no procedure for its renewal, nor is there any restriction of the time period.  As per PDS Control Order, 2001 Fair Price Shop owner is required to display certain information on the Notice Board at a prominent place in the shop.  The Fair Price Shop owners are bound by the terms and conditions laid down in the PDS Control Order, 2001 and the Uttranchal Scheduled Commodities Distribution Order, 2003. The Committee observed that provisions of the Orders are not being followed  by FPS.

 

Transportation of food grains:- 

 

12.             Transportation of food grains from FCI godown to base godown is handled by the Marketing Wing.  From base godown to Internal godown (Block godown), it is done by the District Supply Officer.  From Internal (Block godown) to Fair Price Shop, transportation is done by the Fair Price Shop owner himself. 

 

13.             The transportation of food grains from FCI godowns to base godowns and from base godowns to internal godowns is through the transporters appointed by the Government through tender process.  The expenditure on this account is borne by the State Government.  Because of the special demographic situation, the food grain is transported by trucks, Khachchar (mules) and coolies.  Transport of the food grains from internal godowns to Fair Price Shops is arranged by the Fair Price Shop owners.

14.             In case of AAY category the fair price shop dealer is reimbursed with the transportation cost it bears while transporting the food grains from the state godown to his fair price shop. The same is done after the fair price shop dealer submits his bill. However the Committee was informed that there was huge delays in making payments by the department, resulting into fair price shops suffering losses.

 

15.             In the hilly and inaccessible areas the cost of transportation of food grain from the State godowns to the Fair Price Shops is very high.  The expenditure is incurred by the Fair Price Shop owners. This expense is added to the cost of the grain and charged from the APL and BPL consumer as no Hill Subsidy is given to the State of Uttrakhand by the Central Government. The rates are fixed by the District Magistrate, for different modes of transport for different locations.  There was a general complaint that the rates are not fixed in accordance with the rates actually charged by the transporters.

 

16.             The Committee is of the view that the Public Distribution System is primarily for the welfare of the poor and they should not be charged the cost of transportation. The State Government should ensure door step delivery of food grain at the Fair Price Shops.

 

Advance Allocation:-

 

17.             Another problem regarding transportation is advance allocation.  Some areas of the State become totally inaccessible in the monsoon and winter season. Therefore, there is a provision for advance allocation of food grains before the on set of the monsoon and winter season.  It was observed by the Committee that proper time frame is not observed by the State authorities and the advance allocation which should reach Fair Price Shops at least one month in advance of the on set of the monsoon and winter season gets abnormally delayed. Due to delay it becomes very difficult to transport food grains to the Fair Price Shops for distribution among the PDS beneficiaries.  The delay also entails increase in the cost of transportation. 

 

18.             The Committee was informed that approval of the Central Government is necessary before making advance allocation. Invariably there is delay in obtaining the requisite approval from the Central Government. The Committee is also of the view that the authority for deciding advance allocation may be delegated by the Central Government to the State Government.  This will help in timely transportation of the food grains, well before the on set of the monsoon and winter season.  This will also help in reducing the cost of transport. However the Committee was informed by the FCI that there is no delay on part of the FCI and delay was on account of the State Government not making proper and prompt budgetary allocations. It was further observed by the Committee that there was considerable lethargy on part of the regional food controller of the State in forwarding the advance allocation requirements of the districts as well as making the necessary payments to the FCI for the same, This  was the principle reason for the delay in advance allocation.

 

Delay in Lifting the food grain

 

19.             There was a general complaint that on many occasions when the shop keeper goes to the godown to get his allotment the stock is not available. There are no telephones in the state godowns. The shopkeeper is unable to check from the inspector in-charge of the godown. At times he goes back empty handed. The godown keepers complained that there was delay in supplies to him as the Marketing wing does not deposit the money with the FCI in time to get the food grains. When the amount is deposited the FCI releases the stock, there is no arrangement for lifting the food grain as sufficient trucks are not available or there is no space in the internal/ block godowns and request is made to the FCI to delay the supplies.

 

Leakages and Diversion:- 

 

20.             The Committee found that diversion of food grain takes place from the base godowns and the block godowns. Absence of proper checks on transporters affords ample scope for leakages and pilferages during transportation of the food grains. This leakage or diversion is ultimately adjusted against ration cards at the Fair Price Shops.

 

21.             During the movement of the food grains from FCI to Base godown and from Base godown to Internal (Block) godown there is practically no check on the transporter; No check is conducted at the Fair Price Shop also to ensure proper quantity and quality of food grain or to ascertain whether the quota released for the previous month has been distributed.  As and when inspector comes to the Fair Price Shop, he issues a certificate to the effect that the stock has been sold and based on this certificate the quota is released for the next month to the Fair Price Shop owner. In many areas the certificate is issued by the inspector at his godown when the licencee comes to get his quota.  The certificate is issued without proper checking. In the rural areas, this exercise is done by the Sarpanch of the village panchayat or even Patwari ( Revenue Clerk ) of the village. 

 

22.             The Committee also learnt that at every stage of storage and transportation some pilferage takes place from the jute bags. It was shown to the committee that the easiest way of pilferage was to poke a jute bag to take out grain from it and then close the opening created by the poker. The food grain is not weighed at the time of receiving the same in the godown nor it is weighed at the time of delivery. Food grain should be weighed at the time of unloading and loading in the godown. It is felt that in case TPDS food grain is packed in non- pilferable HDPE bags of 10kg and 5 kg the same can be delivered to the beneficiary in sealed packing.  This measure along with automation in weighing and use of computerization and smart cards would go a long way in eliminating or at least reducing pilferage. It would also ensure a more hygienic handling of food grain and help in ensuring that the food grain of proper quality reaches the beneficiary.

 

Identification of beneficiaries:

 

23.             In the State of Uttrakhand BPL cards are issued to a family whose income is less than Rs.9000/- per annum.  It was observed by the Committee that the criteria of annual income of Rs.9000/- for categorization of BPL need to be revised.  This should be at least on the basis of the calculation as per the minimum wages for the unskilled labour.  The minimum wages in Uttrakhand has now been revised to Rs.100 per day.  Therefore, the BPL criterion needs to be revised.  The Committee is of the view that APL category may be abolished, as there is very small off take of the food grains by the APL families and most of the quota of APL allocated to Fair Price Shops is diverted. This will help in plugging the diversion of food grains which can be utilized actually by needy BPL families.

 

24.             The Committee was informed that the ration cards were issued only till December, 2007 and no new ration cards has been issued since then. Para 2(1) of the Annexe to the PDS Control Order, 2001 provides that no eligible applicant should be deprived of a ration card under the Public Distribution System. It is therefore necessary that if an applicant is denied a BPL/AAY ration card, he should have an avenue to file an appeal. It is also necessary that a yearly review of BPL lists are done to identify ineligible families and include eligible families. Elimination of bogus ration cards as well as bogus units has to be a continuous exercise to check diversion of essential commodities. A ration card should be issued for a period of five years from the date of issue unless it is suspended or cancelled earlier. The direction of Hon’ble Supreme Court in this regard must be followed strictly by the State Govt.  The Committee felt that there are large numbers of bogus ration cards registered with the ration shops.  This must be reviewed by the State Authorities.

 

State Godowns: -

 

25.             Besides the problem of advance allocation which is a requirement because of the inaccessible areas in the monsoon and winter season, the State godowns have some other problems such as complete lack of infrastructure in the State Godowns. There is no system of quality checking, no samples are issued by the base godowns or by the interior godowns, no weight check memos are issued by the base godowns or interior godowns.  In hilly region the sale is opened in the godown itself and Circle Inspector does not open the same at the shop and in rural areas gram panchayat looks after the distribution of food grains and the distribution certificate i.e. Form ‘A’ is certified by the Gram Pradhan. The Committee found that in Kumaon region inspectors do not open sale. There is no proper check to see that all the allocated food grains have been distributed properly or not. There is no electricity and telephone connection at the godowns and there is no computerisation.  There is an acute shortage of inspectors in the State. Some inspectors are looking after more than one godown. Inspectors are not able to visit the shops as they have to be present at the godowns also. Some field inspectors are given very large areas which they are unable to cover. The field inspectors are not given proper traveling allowance. It was also found that some inspectors, who had joined in 1972 -73 have not been promoted for several years and therefore owing to their age and physical condition they are unable to travel in the hills and perform there duties under the various control orders.

 

Viability of Fair Price Shops :-

 

26.             The Committee observed that the administrative cost of Rs.44 per quintal is charged by the State Government over the issue price of the food grains for APL & BPL categories.  The Committee is of the view that this amount is too excessive.  However, the State Government officials clarified that the administrative charges are used to maintain the State godowns and also utilised for the internal movement of the food grains.  The Committee is strongly of the opinion that this amount should be reduced as it is an obligation of the State Government under PDS Control Order to ensure door step delivery to the Fair Price Shops.

 

27.             The commission of the Fair Price Shop owner is just Rs.6 per quintal. With such low commission, Fair Price Shop owner cannot survive thus he devises illegal means to sustain and continue the Fair Price Shop.  Fair Price Shop owners strongly urged that the commission be raised, so that it is viable for them to continue the Fair Price Shop.  The Committee is of the view that in order to improve the viability of fair price shop by increasing the commission, the consumers should not be burdened and at the same time no additional burden should be foisted on the Government. 

 

28.             Presently in the State FPS dealers are selling non-PDS commodities also or running a kirana shop in the same or adjacent premises. Although under the rules they are entitled to sell certain notified commodities keeping in mind the Fact that a stand alone FPS is an inherently unworkable model the state must provide by rules that FPS licence are given only to Kirana Shops in the locality subject to the caveat that they would not sell PDS commodity in open market.

 

29.             For transportation of foodgrains for AAY category, Fair Price Shop owner has to be reimbursed the transportation charges. To get the reimbursement, a Fair Price Shop owner has to obtain a certificate and present the same with the bill in the Office of DSO.   A consolidated bill for all the shops attached with the godown is prepared and sent to the Finance Controller for reimbursement by the DSO.  It was found by the Committee that there is a delay of 4 to 5 years for making the reimbursement and there is no accountability for the delayed payment / reimbursement.  

 

30.             The lack of Storage facilities in the State is another major issue leading to delays in the PDS commodities reaching the beneficiaries on time. FCI issues release order in time after the payment is made by the State Government.  State Government does not have enough space to store foodgrains as the godowns are very small.  Therefore, the Food & Supply Department does not lift foodgrains in time and requests for delay in lifting the supply.  State Government does not have proper arrangements for transportation of foodgrains to their godowns. 

 

Functioning of Fair Price Shop:-

 

31.             It was observed that inspite of the statutory obligations that have been provided by the PDS Control Order, 2001, by the Uttranchal Scheduled Commodities Distribution Order 2003 and the order of Hon’ble Supreme Court; the Fair Price Shop owners were found to be violating norms / rules / regulations etc.  Some of the irregularities found were that the Fair Price Shop remained closed most of the days in a month, did not observe regular timings, did not have proper notice board, no sample was kept, food grains were sold to the beneficiaries at more than prescribed rate, card holders were given less grain than the entitlement and the shop keepers indulged in black marketing.

 

 

Submissions of Fair Price Shop owner before the Committee:-

 

32.             The Fair Price Shop owners submitted their grievances which are as follows:-

                          i.            That the State godowns officials never weigh food grains while giving the allocation to the Fair Price Shops.

                        ii.            The Department officials indulge in black marketing of the food grains through Fair Price Shop.

                      iii.            Since the Commission was low, therefore, the Fair Price Shop owner is compelled to indulge in illegal activities.  It was admitted by one Fair Price Shop owner that he was siphoning some kilos from every BPL card to ensure that he is able to sell substantial amount of food grains in the black market.

 

Vigilance Mechanism :-

 

33.             Awareness and availability of information is the key to vigilance. The PDS Control Order, 2001 provides that a copy of the allocation order made to the Fair Price Shop shall be simultaneously sent to the Nagar Palika, Gram Panchayat or the Vigilance Committees or any other body nominated for monitoring the functioning of the fair price shop. It further provides that the bodies nominated for monitoring the functioning of the FPS by the State Government shall display the stocks of essential commodities allotted during the months to the FPS on a notice board outside their office. 

 

34.             Vigilance under the TPDS is envisaged through the Vigilance Committees, Gram Panchayats, Nagar Palikas, and the Consumer.

 

35.             The provisions regarding Vigilance Committees have been flouted if not ignored by the State Government. Either the Vigilance Committees envisaged under the PDS Control Order, 2001 have not been formed or they have not been meeting and performing their duties. This is because there is no accountability for any one to ensure that the meetings of the Vigilance Committees take place regularly. The PDS Control Order, 2001 provides that the meetings of the Vigilance Committees on Public Distribution System at the State, District, Block and FPS level shall be held on a regular basis. The date and periodicity has to be notified by the State Governments. However, the periodicity has to be not less than one meeting a quarter at all levels.

 

36.             The State Government is duty bound to ensure that meetings of the Vigilance Committees at all levels take place at least once in three months. However, no authority has been made responsible for ensuring that such meetings take place. The State Government should fix the responsibly of the officials of the administrative machinery to convene the meetings and ensure the presence of the members. Rules can provide that any member who does not attend two consecutive meetings would be replaced. The Secretary of the Department of Food and Supply should be responsible for convening the meetings at the State level, the District Magistrate should be responsible for the District level Committee, Block Development Officer should be responsible for the block and FPS level committees.

 

37.             The PDS Control Order, 2001 also requires the State Governments to make rules regarding furnishing of copies of the specified documents, namely ration card register, stock register, and sale register. Any ration card holder desirous of obtaining extracts from the records of the FPS owner can make a written request to such owner along with the fee specified by the State Government and the FPS owner has to supply the copies of the record within fourteen days from date of receipt of the request.

 

38.             The right to information thus provided under the PDS Control Order, 2001 has been negated by the State by not making rules regarding the fees payable for obtaining the copies. Even where such rules have been made, there is no publicity given to educate the beneficiary.

 

39.             The Panchayat and the Nagar Palikas should be actively involved in the vigilance. The elected representatives of the people must perform their duty in keeping a vigil on the activities concerned with the Public Distribution System.

 

40.             The purpose of providing the copies of the allocation order for each FPS should also be sent to the Gram Panchayat or Nagar Palika and should be displayed on their notice board is to prompt their members to be vigilant and check the activities of the FPS licencees.

 

41.             The involvement of political persons in the allotment of FPS should be strictly avoided and they should only be given a role in vigilance In case political persons are involved in the implementation process it becomes difficult to take any action against the defaulting licencee.

 

42.             Another aspect of the Vigilance mechanism is the complaint system. It is necessary that there should be 24 hour dedicated helpline set up in the state so that any one can lodge a complaint against any of the persons involved in the implementation of the Public Distribution System. The telephone number of the helpline should be printed on the ration cards.

 

43.             There should be a machinery to verify the complaints and take action against the guilty. The complainant should be able to follow up his complaint. The identity of the complainant if necessary should be protected. The committee has also recommended the setting up of an independent watchdog in the form of a regulator/ombudsman to oversee the smooth functioning of the system.

 

44.             If the State is unable to setup an Ombudsman as suggested then his tasks may be assigned to the District Judge or to an Additional District Judge in the district concerned.

 

Enforcement:

 

45.             The enforcement in the State under the Public Distribution System is non existent. This is the reason for the improper implementation of the system and large scale diversion. No system can succeed if there is no fear of punishment.

 

46.             The Committee found that the State did not have any enforcement mechanism. A vigilant consumer or any vigilance set up can not succeed without a proper enforcement mechanism. Section 7 of the Essential Commodities Act, 1955 provides for punishment for violations of the Control Orders issued under Section 3 of the Act.

 

47.             It has also been observed that the cases filed under the Essential Commodities Act, 1955 keep on pending in courts indefinitely and a large majority of cases end up in acquittal of the accused persons. It is necessary that special courts and specially trained prosecutors are appointed for the trial of these cases.

 

48.             The licence granted to the dealers lay down certain conditions. The violation of these conditions makes the licencee liable for cancellation of his licence. The Supreme Court has also ordered that a licence would make himself liable for cancellation of his licence in the following cases.

          That the licences of those fair price shop owners :-

                    i.                        who do not keep their shops open throughout the month during the stipulated period,

                  ii.                        fail to provide grain to BPL families strictly at BPL rates,

                iii.                        keep the cards of BPL households with them,

                iv.                        make false entries in the BPL cards,

                  v.                        engage in black-marketing or siphoning away of grains to the open market, and

                vi.                        Hand over such ration shops to other person/organizations.

49.             This order was passed on 2.5.2003 but no action has been taken by the State to enforce this order. It is therefore necessary that the special squads be formed consisting of persons drawn from the administration and the police and should be placed directly under the District Magistrate. These squads should be responsible for conducting raids, launching criminal prosecutions and also for recommending departmental action for suspension or cancellation of licence, or imposing penalties. The Committee was not informed if any action had been taken against any official though it can not be denied that no diversion of food grain is possible without the connivance of the officials of the department. . It is also important that these squads also have the powers to recommend action against officials in whose jurisdiction violations are detected or who is found to be involved in diversion of food grain. The Committee feels that there should be dedicated Special squad in every District for enforcement of the penal provisions of the Essential Commodities Act, 1955. The Committee has suggested Zero Tolerance in the matter of enforcement in the Public Distribution System.

 

 

Computerisation :-

 

50.             Computerization of PDS can help in proper managing of the system, and improve the transparency and in better enforcement of rules. This Committee has already submitted a comprehensive report on computerization of the Public Distribution System and the same be read as part and parcel of this report

51.             It has been observed by the Committee that the computerization in the entire State is almost negligible. However, the Common Service Centres (CSC) set up in the state can act as the connectivity hub for end to end computerization even in rural and inaccessible areas.

 

 

 

 

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 FINAL REPORT

 

 

CHAPTER 1

GENERAL INTRODUCTION

 

I.       ABOUT THE STATE OF UTTRAKHAND[2]

 

1.1             The State of Uttarakhand is the 27th state of India which came into existence on 09.11.2000. The State borders Tibet to the north, Nepal to the east, and the States of Himachal Pradesh and Uttar Pradesh in the west and south respectively. The State of Uttrakhand was earlier a part of the State of Uttar Pradesh, therefore many administrative procedures including the laws which are in force in the latter State are still in effect in the State of Uttarakhand. One of the main objectives of the creation of the new State was rapid economic development. Various factors have contributed to the economic backwardness of the State of Uttarakhand, one of the foremost being slow industrial growth. The reasons for this include hilly and difficult terrain, gaps in infrastructure, lack of connectivity, limited access to markets and most importantly, the absence of a specific policy for industrial development in the area in view its special conditions.

 

II.      DEMOGRAPHICS & GEOGRAPHY

2.1             According to 2001 Census, the State of Uttarakhand has a population of approximately of 8.48 million and is expected to be 10 million by the next census in 2011. The native people of Uttarakhand are called either Garhwali or Kumaoni depending on their place of origin in either the Garhwal or Kumaon region. Nepalis, Bengalis, Punjabi’s and Tibetans of Eastern Tibet region (Khampa) have also settled in the State. Another well known category is Gujjar, cattle herders in the southwestern Tehri. The State of Uttarakhand comprises 13 districts. They are Pithoragarh, Almora, Nainital, Bageshwar, champawat, Uttarkashi, Udhaam Singh Nagar, Chamoli, Dehradun, Pauri Garhwal, Tehri Garhwal, Rudraprayag, and Haridwar.

 

2.2             Uttarakhand has a total geographic area of 51,125 km², of which 93% is mountainous and 64% is covered by forest. Most of the northern parts of the state are part of Greater Himalaya ranges, covered by the high Himalayan peaks and glaciers, while the lower foothills are not densely forested.

 

2.3             The State lies on the south slope of the mighty Himalaya range, and the climate and vegetation vary greatly with elevation, from glaciers at the highest elevations to tropical forests at the lower elevations. The highest elevations are covered by ice and bare rock.  The State is mostly located in the Himalayas; therefore the topography of the region is mostly mountainous with a major portion under forests. Keeping in view the topographic characteristics, specific availability of land resources for urban development and economic mobility. Uttarakhand is divided into Garhwal and Kumaon Region and Committee visited both regions. Geographically thirteen districts in Uttarkahand are divided into three broad categories viz. 

a)                 The High  Mountain Region                                           

(major portion of Uttarkashi, Champawat, Pithoragharh, Chamoli and       Rudraprayg districts)

 

b)                 The Mid –Mountain Region

          (major areas in Pauri Garhwal, Tehri , Almora, Bageshwar districts);

 

c)                  The Doon Or Terai Region                                              

          (lower foothills undulated plains of Dehradun, Nainital and    Udhamsingh Nagar and Haridwar Districts)

 

2.4             In January 2007, the name of the state was officially changed from Uttaranchal, its interim name, to Uttarakhand, according to the wishes of a large section of its people. The provisional capital of Uttarakhand is Dehradun which is also a rail-head and the largest city in the region.

 

2.5             The reason of choosing State of Uttarakhand for study of the PDS system is Uttarakhand’s peculiar geographical conditions with different kinds of problems in distribution of the foodgrains. It has High mountain region, mid mountain region, and plain or foothill region. Therefore, committee chose Uttarkashi , Champawat and Pithoragarh(which is high mountain region), Almora ,Tehri and Pauri (which are mid mountain region), and Dehradun, Haridwar, Rishikesh and Nainital which are foot hill/ plain regions.

 

2.6             The mechanism of Public Distribution System is not uniform in the entire State. The Department of Food and Supply has adopted different methodology in hill region keeping in mind the terrain and difficulties that its inspectors face. During visits the Committee observed irregularities in both the plains and hill region which can be broadly stated as under :-

 

a)                 Transportation of food grains in inaccessible areas especially the advance allocation often gets delayed.

b)                 BPL card holders not getting their complete entitled quota

c)                  Inclusion and exclusion errors

d)                 Food grains sold at excessive price at the fair price shops

e)                 Irregular timings of the fair price shops

f)                   Non-existence of Vigilance and Enforcement mechanism.

g)                 Non-observance of PDS Control Order, 2001 and Uttranchal Scheduled Commodities Distribution Order, 2003 and directions of the Supreme Court.

h)                 No check on issue of APL Cards.  Central Government does not issue APL quota considering the number of cards.

i)                   Delay in lifting of food grain

j)                   Leakages and diversion.

k)                 Political interference.

 

2.7             In respect of the distribution of the food grains in both the plains and hill region, it was found that the problem was uniform i.e. either people are getting less food grains than their allocated quota or they were not at all getting anything. The said grievance is apart from the common grievance of higher price being charged by the fair price shop owner from the consumers. The nature of the problems in both the regions is essentially the same but the factors leading to such problems are different.   

 

 

 

 

 

 

 

 

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CHAPTER 2

 

LEGAL REGIME GOVERNING THE PUBLIC DISTRIBUTION SYSTEM

 

I.       The statutory framework governing and regulating the different aspects of the Public Distribution System is contained in the Essential Commodities Act 1955, Public Distribution System (Control) Order 2001 as amended in 2004 and Circulars issued by the Department of Food & Public Distribution in the Ministry of Consumer Affairs, Government of India and the Uttaranchal Scheduled Commodities Distribution Order, 2003 as well as various Circulars, Orders and Notifications issued by the Department of Food Supplies and Civil Supplies, Government of Uttarakhand.

 

II.      BROAD OVERVIEW OF THE STATUTORY REGIME

 

2.1       ESSENTIAL COMMODITIES ACT, 1955: The Essential Commodities Act 1955 (Act) is an Act to provide, in the interest of general public, for the control of the production, supply and distribution of, and   trade and commerce, in certain commodities.

 

a.       Section 3 of the Act confers powers on the Central Government to control production, supply, and distribution etc. of essential commodities.  Central Government has issued an order called Public           Distribution System (Control) Order 2001 (Order), which was amended in 2004.

 

b.       Stringent provisions have been provided in the Act and the   Order, to deal with any infringement of the provisions of the Act or      the Order.

 

c.       Section 7 provides for penalties.  Any person contravening the Order is liable to be sentenced to imprisonment, which may extend upto 7 years and shall also be liable to fine.  Sentence of imprisonment cannot be less than 3 months unless there are adequate and special reasons.  The property in respect of which contravention of the Order has taken place, is liable to be forfeited to the Government and so also any vehicle used in carrying such commodity.  If a person commits offence a second time then imprisonment cannot be less than 6 months subject to, adequate and special reasons.

 

d.       Section 8 provides that a person who attempts to contravene or abets any contravention of the Control Order is similarly liable.

 

e.       Section 9 provides for punishment upto 5 years or fine or both, if the record is not maintained in terms of the Control Order or any statement or information furnished, which is not true.

 

f.        Section 10 deals with offences by Companies, in which case every person who at the time of contravention was incharge, is responsible for the contravention and shall be deemed to be guilty.

 

g.       Section 10A has made any offence punishable under the Act           cognizable.

h.       Section 10C provides that Court may presume the existence of        such mental state where an offence under the Act requires culpable mental state on the part of the accused.  “Culpable mental state” includes intention, motive, knowledge or reason to believe a fact.

i.        Under Section 11, a Court can take cognizance of an offence           under the Act not only on a complaint made by a public servant but also by any person aggrieved or any recognized consumer           organization. 

 

j.        An offence for contravention of the Control Order is to be tried       summarily (Section 12A).

 

k.       No appeal can be filed if an accused is sentenced to imprisonment for a period not exceeding one month and of a fine not exceeding Rupees two thousand.

 

l.        Section 14 provides that when a person is prosecuted for contravention of any order which prohibits him from doing any act or being in possession of a thing without lawful authority or without a permit, licence or other document, the burden of proving that he has such an authority, permit, licence or other document, shall be on him.

 

2.2             The Public Distribution System (Control) Order, 2001: The Public Distribution System (Control) Order, 2001 (hereinafter referred to as the ‘PDS Control Order, 2001) has been issued by the Central Government in exercise of powers conferred by Section 3 of the Essential Commodities Act, 1955 for maintaining supplies and securing availability and distribution of essential commodities under the Public Distribution System. The said Order has been amended in 2004.

 

2.3             The Uttaranchal Scheduled Commodities Distribution Order, 2003: The Uttaranchal Scheduled Commodities Distribution Order, 2003 has been issued by the State Government in exercise of the powers conferred by Section 3 of the Essential Commodities Act, 1955, for the purpose of maintaining supplies of food grains and other essential commodities and for securing equitable distribution of essential commodities at fair price shops in the State of Uttrakhand.

 

2.4             Distribution Machinery

 

A.      Allotment of licences/authorizations to set up a Fair Price Shop.

 

i.                    Clause 3 of the Uttaranchal Scheduled Commodities Distribution Order, 2003  provides that in view of effecting fair distribution of the   scheduled commodities, the State Government may issue directions to set up number of fair price shops in an area as it deems fit.

ii.                  There are separate procedures for allotment of fair price shops for both rural and urban area. In rural Areas person is nominated in open meeting of Gram Sabha and if he is also recommended by BDO ,his name is forwarded to DSO who after proper verification of all the required documents select him  and District Magistrate passes the order of his appointment.

 

iii.                In urban areas, a vacancy for opening of a new fair price shop is normally notified if there are 4000 units in the area. Once a vacancy of a fair price shop was determined, an advertisement is published in the newspaper inviting applications. Once all the applications are received the circle supply inspector makes an inspection and on the basis of the report some candidates are selected to appear before the Selection Committee. That the Selection Committee consists of the following :-

1.     District Supply Officer,

2.      District Magistrate/ Additional Magistrate,

3.      Chief Development Officer

4.      One nominee of the Revenue department.

 

iv.         The licence so allotted is not restricted by any time period. i.e. there is no renewal procedure.

 

B.       Duties and Obligations of a Fair Price Shop Licencee:

 

i.        The PDS Control Order, 2001, under Clause 7 read with paragraph 5 of the Annexure to the Order lays down the procedure for issue of licences or authorization to the fair price shops for the distribution of essential commodities under Public Distribution System. And duties         and responsibilities of the fair price shop owners are provided. That      similar responsibilities and duties have been fixed by Clause 22 of the Uttaranchal Scheduled Commodities Distribution Order, 2003.

a.       Para 5(i) of Annexure to PDS Control Order, 2001 provides that      the essential commodities must be sold as per the entitlement of             ration card holders and at the retail issue prices fixed by the     concerned State Government.

 

b.       Para 5(ii) of the Annexure to PDS Control Order, 2001 provides that each FPS will display the following information on a notice board which is to be put up at a prominent place in the Shop on a daily basis:-

          (1)     List of BPL and Antyodaya beneficiaries,

          (2)     Entitlement of essential commodities,

          (3)     Scale of issue,

          (4)     Retail issue price,

          (5)     Timings of opening and closing of the fair price shop,

(6)     Stock of essential commodities received during the month,

(7)     Opening and closing stock of essential commodities and

(8)   The authority for redressal of grievances/lodging plaints with respect to quality and quantity of       essential commodities under the Public Distribution System.

c.       This information is also required to be displayed in terms of Clause 22(ii) of the Uttaranchal Scheduled Commodities Distribution Order, 2003. An additional detail required to be displayed in terms of the said order is the weekly off day for the shop.

d.       Under Para 5(iii) of the Annexure to PDS Control Order, 2001, a FPS owner is required to maintain records of ration card holders (APL,   BPL and Antyodaya), stock register, issue or sale register. The said    obligation is also fixed by Clause 22(iii) of the of the Uttaranchal     Scheduled Commodities Distribution Order, 2003.

         

e.       Para 5 (iv) of the Annexure to PDS Control Order, 2001 requires the FPS owner to furnish copies of specified documents such as the ration card register, stock register, sale register to the office of the Gram Panchayat or Nagar Palika or Vigilance Committee or any other body authorized by State Governments for the purpose. The said obligation is also fixed by Clause 22(iv) of the of the Uttaranchal   Scheduled Commodities Distribution Order, 2003.

         

f.        In terms of Para 5 (v) of the Annexure to PDS Control Order, 2001 the FPS owner is obliged to display samples of foodgrains being supplied through the fair price shop. The said obligation is also fixed      by Clause 22(v) of the of the Uttaranchal Scheduled Commodities   Distribution Order, 2003

         

g.       Para 5(vi) of the Annexure to PDS Control Order, 2001 provides for the production of books and records relating to the allotment and distribution of essential commodities to the inspecting agency and furnishing of such information as may be called for by the designated           authority. The said obligation is also fixed by Clause 22(v) of the of the Uttaranchal Scheduled Commodities Distribution Order, 2003

 

h.       Para 5(vi) of the Annexure to PDS Control Order, 2001 deals with the accounting of the actual distribution of essential commodities and the balance stock at the end of the month to the designated authority of the concerned State Government with a copy to the Gram          Panchayat. The said obligation is also fixed by Clause 22(vii) of the of    the Uttaranchal Scheduled Commodities Distribution Order, 2003

 

i.        Para 5(vii) of the Annexure to PDS Control Order, 2001 requires the Fair Price Shop to be opened and closed as per the prescribed timings displayed on the notice board. The said obligation is also fixed   by Clause 22(viii) of the of the Uttaranchal Scheduled Commodities           Distribution Order, 2003.

j.        Clause 7(2) of the PDS Control Order, 2001 lays down that- fair price shop owner shall not refuse to supply the essential commodities, lying in stock, to the ration card holders, as per their entitlement. Clause 7(3) provided that the fair price shop owner shall not retain ration cards after the supply of the essential commodities.

k.       Clause 23 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 further puts an obligation on the fair price           shop owner that he shall observe such conditions as the State Government or the Collector may by an order direct from time-time in respect of the opening of shop, maintenance of stocks and supply and     distribution of the Scheduled Commodities, maintenance of accounts,   filing returns and issue receipts of identity card-holder and the           matters.    

l.        Clause 23 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 further bars a fair price shop owner to          appoint any person as sub-agent or transfer his licence to any other person and it further states that no other person apart from the      licencee shall run the fair price shop. 

m.      Clause 16 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 states that the fair price shop owner should maintain a sale register in which he should fill the details of the card holder along with the quantity of the food grain purchased with the          date of purchase.

n.       Clause 17 of the Uttaranchal Scheduled Commodities Distribution Order 2003 further fixes an obligation on the fair price shop owner that he shall not keep in his possession of any ration card           of any ration card holder.      

C.       Ration Cards

i.        The Government has, for the purpose of issuing ration cards, divided the targeted population into 3 broad categories, Above Poverty Line (‘APL’), Below Poverty Line (‘BPL’) and Antyodaya Anna Yojana (‘AAY). Clause 2(d) of the Public Distribution System Order, 2001 defines 'Above Poverty Line Families' as those families which have been issued Above Poverty Line (APL) ration cards by the State Governments for issue of foodgrains under the Public Distribution System, Clause 2(g) defines 'Below Poverty Line families' as those families which have been identified by the State Government for issue of foodgrains at specially subsidized rates adopting the estimates of poverty given by the Central Government Clause 2(e) defines 'Antyodaya families' as the poorest families from amongst the Below Poverty Line (BPL) families identified by the State Governments. Such families are entitled to receive foodgrains under the Antyodaya Anna Yojana.

ii.       Clause 3 of the PDS Control Order, 2001 states that State Governments shall identify families living Below Poverty Line as per paragraph 1 of the Order. Para 1(1) requires State Governments to formulate suitable guidelines for the purpose of identification of families living Below the Poverty Line (BPL), including the Antyodaya families, as per the estimates adopted by the Central Government. It is further provided that care be taken to ensure that the families so identified are really the poorest. Para 1(2) requires the State Governments to get the lists of BPL and Antyodaya families reviewed every year for the purpose of deletion of ineligible families and inclusion of eligible families.

iii.      Clause 4 of the Public Distribution Order 2001 requires the State Governments to issue distinctive ration cards to Above Poverty Line, Below Poverty Line and Antyodaya families and further mandate that a periodical review and checking of the ration cards be conducted as per paragraph 2 of the Annexure to the Order. Para 2(3) provides that State Government shall issue distinctive ration cards to APL, BPL and Antyodaya families.

iv.      Para 2(4) of the Annexure to PDS Control Order, 2001 provides that the designated authority shall issue a ration card within one month of the date of receipt of the application after necessary checks and verification.

v.       Para 2(6) of the Annexure to PDS Control Order, 2001 requires the State Government to conduct periodical checking of ration cards to weed out ineligible and bogus ration cards and bogus units in ration cards.

vi.      Para 2(8) of the Annexure to PDS Control Order, 2001 lays down that elimination of bogus ration cards as well as bogus units in the ration cards shall be a continuous exercise by the State Governments to check diversion of essential commodities.

vii.     Clause 5 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 authorises a “Food Officer” to issue a ration card on payment of the prescribed fees by such applicant.  However, the clause further clarifies that in rural areas the food officer authorised to issue ration cards shall be concerned Sub-Divisional Magistrate and in urban areas the Food Officer shall be a City Magistrate or any other Magistrate so authorised by the concerned District Magistrate.

viii.     Clause 6 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 states that a ration card so prepared by the department shall have the following details:

a)       The correct name and address of the cardholder with his/her latest photograph,

b)       The number members/units in the family of the cardholder.

c)       The name of the other members/units with their photograph.

d)       The name and complete address of the fair price shop with whom the card is attached.

ix.      Clause 7 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 deal with the amendment and rescission of ration cards. Whereas 13 and 14 of the said order deals with the procedure to be followed in case if the number of units of a particular ration card has changed.

x.       Clause 10 and 11 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 impose an obligation on the ration card holder not to keep invalid or bogus cards and also a ration card holder should refrain from using invalid ration cards.

 

2.5     Entitlement of different categories of Consumers and Price Payable

 

A.                Clause 5 of the PDS Control Order, 2001 lays down that the Central Government shall make available to the State Governments foodgrains for distribution under the Public Distribution System at such scales and prices as may be specified from time to time provided in terms of paragraph 3 of the Annexure to the Order.     

 

B.                 Clause 9 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 provides that unless otherwise directed by the Collector, the entire quota of the month may be lifted by the ration card holder in one purchase.

 

C.                 That under the Uttaranchal Scheduled Commodities Distribution Order, 2003, the distribution of the food grains is to be done on the basis of the unit of each ration card. However subsequently it has been decided that each ration card holder irrespective of number of unit would be entitled for 35kgs of food grains.

 

D.                An APL card holder is entitled to 25 Kg of Rice at Rs. 8.80/kg and 10 kg of Wheat at Rs. 6.60 kg.

 

E.                 A BPL card holder is entitled to 25 kg of Rice at Rs. 6.15/kg and 10 kg of wheat at Rs. 4.65/kg.

 

F.                  AAY beneficiary gets 25 kg of rice at Rs 3 per kg and 10 kg of wheat at Rs. 2 per kg.

 

III.    PROVISIONS FOR MONITORING

 

3.1     Public Audit

 

A.      Para 6(9) of the PDS Control Order, 2001 states that the designated authority shall direct the concerned fair price shop owner to provide relevant extracts of the documents maintained by him on an application made by a beneficiary, on payment of a prescribed fee.

B.       It is pertinent to note that Clause 7(4) of the PDS Control Order, 2001, confers on any ration card holder desirous of obtaining extracts from the records of a fair price shop owner, the right to obtain the same by making a written request to such owner along with deposit of the fee specified by the State Government. Clause 7(4A) imposes an obligation upon the fair price shop owner to provide extracts of records to the ration card holder within fourteen days from the date of receipt of a request and the specified fee under sub-clause (4).

C.       Para 6 (7) of the Order requires State Governments to educate the ration card holders regarding their rights and privileges under the Public Distribution System by use of electronic and print media as well as display boards outside fair price shops.

IV.     PROVISIONS FOR COMPUTERISATION

 

4.1     Para 6(6) of the  Annexure to the PDS (control) Order 2001 requires State Governments to ensure monitoring of the functioning of the Public Distribution System at the fair price shop level through the computer network of the NIC installed in the District NIC centers and to issue for this purpose computerized codes to each FPS in the district.

 

V.      PROVISIONS FOR VIGILANCE FRAMEWORK

 

5.1     Clause 8 of the PDS Control Order, 2001  provides that the procedure for monitoring of the Public Distribution System including the functioning of the fair price shops by the State Governments shall be as per paragraph 6 of the Annexure to the Order.

5.2     Para 6 (1) of the Annexure to the PDS Control Order, 2001 requires State Governments to ensure a proper system of monitoring of fair price shops and prescribes model sale register, stock register and ration card register. Para 6(2) requires State Governments to ensure regular inspections of fair price shops, not less than once in six months by the designated authority. State Governments may issue orders specifying the inspection schedule, list of check points and the authority responsible for ensuring compliance with the said orders. Para 6 (3) provides that meetings of the Vigilance Committees on the Public Distribution System at the State, District, Block and FPS level shall be held on a regular basis at such dates and periodicity as notified by State Governments. However, it is stated that the periodicity shall not be less than one meeting a quarter at all levels. Para 6(4) imposes upon State Governments the duty to ensure a periodic system of reporting and it further lays down that the complete information in this regard be sent in the prescribed form as follows:

(a)      By fair price shops to the District Authorities by the 7th of the month following the month for which allocation is made in Form ‘A’.

(b)     By the District Authorities to State Government by the 15th of the month following the month for which allocation is made in Form ‘B’.

(c)      By the State Government to the Central Government by the end of the month following the month for which allocation is made in Form ‘C’.

5.3     Clause 6(8) lays down that State Governments shall issue and adopt the Citizen’s Charter based on the model Citizens Charter issued by the Central Government.

5.4     The Model Citizens Charter on the Targeted Public Distribution System requires the State Governments to constitute Vigilance Committees at the Shop/Panchayat, Block, District/Area and State/Union Territory level, associating persons from the Government, Social Organisations, Consumer Organisations and local bodies to review the functioning of the schemes and Fair Price Shops under the PDS.

 

VI.     PROVISIONS FOR SEARCH AND SEIZURE

 

6.1     The Essential Commodities Act, 1955 provides that any essential commodity and any package, covering or receptacle in which the essential commodity is stored and any animal, vehicle, vessel or conveyance used for transporting the essential commodity may be seized and confiscated under Section 6A pursuant to an order passed under Section 3. However, prior to confiscating any essential commodity, package or vehicle, Section 6B requires that a show cause notice be issued to the person from whom it is seized.

6.2     The PDS Control Order, 2001 under Clause 10 (1) empowers the authority authorized by State Government, to inspect or summon such records or documents as may be considered necessary for examination and take extracts or copies of any record or document produced before it. Clause 10(2) lays down that if the authority has reason to believe, on receipt of a complaint or otherwise that there has been any contravention of the provisions of the Order or with a view to securing compliance with the Order, it may enter, inspect or search the fair price shop or any premises relevant to transactions of business of the fair price shop. Clause 10(3) empowers the said authority to search, seize or remove such books of accounts or stocks of essential commodities where such authority has reason to believe that these have been used or will be used in contravention of the provisions of this order. Clause 10(3A) lays down that the authority conducting search and seizure under sub-clause (3) shall inform the State Government or an officer authorized by it in this behalf, about the details of the search conducted and the stocks of essential commodities so seized under that clause. Clause 10(4) lays down that the provisions of Section 100 of the Code of Criminal Procedure 1973, relating to search and seizure shall so far as may, apply to search and seizure under the Order.

6.3     Clause 19 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 empowers a food officer, a senior supply inspector, senior marketing inspector, or a supply inspector to enter, search a fair price shop and seize any book of accounts and documents. The said clause further provides that the food officer or any such other official so authorized under the said clause should send a report under Section 6A of the Essential Commodities Act, 1955 to the Collector of that district in which such seizure is made. The clause further lays down that the provisions of Section 100 of the Code of Criminal Procedure 1973, relating to search and seizure shall so far as may, apply to search and seizure under the Order. Under Clause 20 of the Uttaranchal Scheduled Commodities Distribution Order, 2003 the State Government may authorize any person to perform the functions as prescribed in Clause 19 of the said Order.   

VII.    PROVISIONS FOR APPEAL

7.1     The Essential Commodities Act, 1955 under Section 6C provides that a person who is aggrieved by the confiscation of any essential commodity, package or vessel may file an appeal to any judicial authority appointed by the State Government concerned and the judicial authority shall, after giving an opportunity to the appellant to be heard, pass such order as it may think fit, confirming, modifying or annulling the order appealed against.

7.2     The PDS Control Order, 2001 under Clause 11(1) provides that appeals (arising out of the denial of issue/renewal of ration cards, denial of issue/renewal of licence to run a FPS) may be filed before the Appellate Authority appointed under Para 7 of the Annexure to the Order. Clause 11(4) provides that the appeal shall not be disposed off without providing the person aggrieved a reasonable opportunity of being heard. Clause 11(5) provides that the Appellate Authority may stay the operation of the order appealed against, pending disposal of the appeal or till such time as the person aggrieved is given a hearing as provided under Clause 11(4). Para 7 of the Annexure to the Order lays down that the State Governments shall appoint an officer of that Government not below the rank of Additional District Magistrate of a District as the “Appellate Authority” for exercising the powers conferred upon and discharging the functions assigned under the PDS Control Order, 2001.

7.3     There is no appeal provision in the Uttaranchal Scheduled Commodities Distribution Order, 2003.

 

VIII.  ORDERS PASSED BY THE HON’BLE SUPREME COURT IN W.P.       (C) NO. 196 OF 2001.

8.1             The Hon’ble Supreme Court by the order dated 02.05.2003 directed as follows,

A.      That the licences of those fair price shop owners who do not keep their shops open throughout the month during the stipulated period, fail to provide grain to BPL families strictly at BPL rates, keep the cards of BPL households with them, make false entries in the BPL cards, engage in black-marketing or siphoning away of grains to the open market and hand over such ration shops to such other person/organizations, will be liable to be cancelled.

B.       The Government of India was directed to place the under mentioned classes of persons in the AAY category,

i.        Aged, infirm, disabled, destitute men and women, pregnant and lactating women,

ii.       Widows and other single women with no regular support,

iii.      Old persons (aged 60 years above) with no regular support and no assured means of support,

iv.      Households with a disabled adult and  not assured means of subsistence,

v.       Households where due to old age, lack of physical or mental fitness, social customs, need to care for a disabled, or other persons no adult member is available to engage in gainful employment outside the house.

vi.      Primitive tribes

 

8.2     The Hon’ble Supreme Court by its order dated 8.5.2002 has fixed the responsibility on the District Collector for implementation of the orders of this Court and further directed that the Chief Secretary will ensure compliance with the order of this Court. It was found however that this requirement was observed more in its breach.  

 

*******

 


CHAPTER 3

 

THE PUBLIC DISTRIBUTION SYSTEM IN THE STATE

 

I        General Setup

 

1.1     State of Uttarakhand at present has 8413 Fair Price shops. The total no. of ration card holders in the State of Uttarakhand are 2280560.

 

II.        ENTITIES INVOLVED IN THE SUPPLY OF FOOD GRAINS TO CONSUMERS: The entire structure of the public distribution system could be understood by looking at the functioning of the various entities that exist in the public distribution system in the State of Uttarakhand: 

 

 

2.1             The Food Corporation of India (FCI)

 

A.                The FCI was set up under the Food Corporations Act, 1964, inter alia for the purpose of distribution of food grains throughout the country under the Public Distribution System. The FCI is responsible for making food grains available to the State Governments in terms of the allocations fixed by the Central Government.

 

B.                 The role of the Food Corporation of India (FCI) is very restricted. The State of Uttarakhand procures food grains (both wheat and rice) both for the State Pool and Central Pool. The state first utilizes the food grains from the State Pool for feeding the beneficiaries under the Public Distribution and only when there is a shortage of food grains on the intimation sent by the Regional Food Controller the demand is placed before the FCI.   Whole State is divided in six districts for distributing the food grains to various State godowns. The said division is purely for the convenience of FCI and is not based on the political division of districts.

 

C.                 Central Government had issued a notification vide its D.O. Letter dated 24-10-07 that a system of regular inspection be put up in place not only for FCI godowns but also for state government/authorized wholesale godowns. In reference to that FCI issued instructions to all regional general managers vide Letter dated 31-10-07 to conduct inspections of FCI godowns and other wholesale godowns. However, the Committee was informed by the FCI officials that the Department of food and Civil Supplies, Uttrakhand was not cooperating with the FCI in this respect and had not issued necessary directions.

 

2.2             The Department of Food and Civil Supplies, Government of Uttrakhand:

 

A.                The Department manages the Public Distribution System in the State of Uttrakhand. It is engaged in issuing/renewing/canceling licences to set up Fair Price Shops, Identification of families which fall below the poverty line, Issuing/renewing/canceling ration cards, enforcing the provisions of the Essential Commodities Act and the various Control Orders issued there under and taking punitive action against persons found to be violating the provisions of the same.

 

2.3     The hierarchical setup of the department is as follows[3]:

 

Commissioner

 


Additional Secretary

 


Additional Commissioner

 


Deputy Commissioner

 

 


Assistant Commissioner

 


District Supply Officer

 

 


Area Rationing Officer

 

 


Senior Inspector

 

Inspector

2.4     The Department of Food and Supply is divided into Following Wings :-

  1. Marketing Wing: The Marketing wing is a department of the government inter-alia charged with the responsibility of procuring the food grains for both the Central Pool and State Pool. The marketing wing is also entrusted to manage the State Godowns of the entire state. However, as mentioned above in hill regions the marketing wing does not manage the state godowns due to inadequate strength of officials whom it can depute in the hill region, therefore, it is the department of food and civil supplies which manages and run the state godowns in the hill region. Regional Food Controller (“RFC”) is head of Marketing Wing.

 

  1. Supply Wing:  Supply wing is responsible for transportation from Base Godown to Internal Godowns, storage in internal Godown and distribution through FPS. District Magistrate supervise distribution in District and District Food and Supply Officer (DSO) is the senior most officer of Food and Supply Department in a district in Supply Wing. The Main Responsibilities of Supply wing are to issue Ration Cards to beneficiaries,  Allotment of  Fair Price Shops, Maintainence of Internal Godowns and distribution of Foodgrains to FPS owners from Internal Godowns.

 

  1. Finance Controller Wing:   It looks into the financial  matters. Finance Controller is head of this wing. Regional Finance Controller works under Finance Controller.

 

2.5             Fair Price Shops (‘FPS’):

The Fair Price Shops are the final link in the chain of distribution of food grains to the consumers. The State of Uttarakhand is divided into 13 districts and has in total 8413 fair price shops with 2280560 ration cards.

 

III.    Procedure of Procurement of Food Grains by Department

 

3.1       The Department of Food and Civil Supplies obtains the food grains either by procurement within the State or by buying the food grains from the FCI. The latter is done only in case there is deficit even after procuring the food grains.  In the State of Uttarakhand annual target for procuring the food grains under PDS is 8600 MT, and it is only when there is shortage, the department buys it from the FCI.

 

3.2       Regional Food Controller is in charge of keeping a track on the quantity of food grains, which has been procured by the State. Presently there are two Regional Food Controllers covering two areas namely Kumoan Mandal and Rishikesh.   Regional Food Controller performs the following functions:

 

A.    Engages trucks for transporting the food grains from FCI Godown to base Godown (State godowns).

B.     Enters into contract with transporters and arranges trucks by issuing tenders every year for transportation of PDS foodgrains.

 

3.3     When ever there is a shortage of food grains after procurement, Regional Food Controller places the demand before the FCI.  The FCI after receiving such demand and money issues Release Orders. The FCI sends the Release Orders to the department, which is submitted to FCI godowns situated in the State.

 

IV.     WHOLE SALE DISTRIBUTION

 

4.1     There are mainly two types of state godowns. One is Base Godown, which is located in the plain regions, and the other is Block Godown( also referred to as internal godown) , which is located in the hilly regions.

 

4.2     The total numbers of State godowns (both Base and internal Godowns) in Uttarakhand is 173. Out of which 83 are State owned godowns and rest 90 are hired godowns. The State has total storage capacity for 51949.3 MT of food grains. 

 

4.3     The food grains are transported from the FCI godowns to base godowns and if the food grains are meant for hilly region, the same are again transported to block Godowns. Base Godown are maintained by the Marketing Wing while the Block Godowns are maintained by the Supply Wing.

 

4.4     The following registers are maintained by a State Godown irrespective of whether the same is a base or a block Godown. The registers are:

 

i)        Stock Register: - In the said register the details of the food grains in respect of wheat, rice, sugar, is maintained and it is also pertinent to mention that the said details are also classified under various schemes i.e. details of the procurement and issuance of food grains under the PDS under various category is maintained.

 

ii)       Challan Register:-  This register is basically a record of all the challans (issuance slips), which are a piece of evidence on the movement of the food grains from one godown to other godown and from FCI to State godown and from  State godowns to Fair price Shops.

 

iii)      Sale Register:-  The said register has the data of all the food grains sold to various Fair price Shops that fall under the ambit of the said State Godown.

 

iv)      Weight Check Memo (WCM) Register: - Like FCI the State Godown while issuing food grains to Fair Price shops issues the weight check memo.  The said Weight Check Memo contains the details of the number of bags loaded in a truck along with weight of the bags and in particular the Fair price Shop, where it is intended to be unloaded.  The weight check memo also has the details of the truck as well.  However, it was observed by the Committee that the said weight Check Memo issued by the State Godown was on a plain paper and the details recorded were not at all legible. In Uttarkashi District and Tehri District the Committee observed that WCM’s were not issued to fair price shops.  

 

4.5     WHOLE SALE GODOWNS IN INACCESSIBLE AREAS

 

A.      Internal Godowns in inaccessible areas are of two kinds :-

1.     Paidal Godowns: “Paidal Godown” means Godowns which is located in the hilly region and is not accessible through motor transport, but where the food grains under the PDS is transported either by head load (labour) or through Khacchars (mules).

 

2.     Migratory godowns: Migratory godowns are those godowns which shift to hilly areas during the summers and shifts to base areas during the rain and winters as there are some hilly inaccessible areas in Uttarakhand where the population does not reside for whole year and they shift to base areas during winters as the places become too cold to live.

 

4.6     PAIDAL GODOWNS

 

A.      During the earlier visits to the State, the Committee was informed about “Paidal Godowns”. However while studying the Rules and Notifications governing the State, the Committee did not find any definition to the said term. By a letter dated 15.12.2008 the Committee asked the State Government to give the definition of the said term. However the Committee has not received any reply to the letter of the Committee despite being reminded. During a later visit by the Committee the officials were specifically asked in respect of the definition of the term “Paidal Godown”. The Committee was informed by the officials including the Additional Secretary, Food and Civil Supplies that there was no formal meaning to the term.  However, on further enquiries, it was stated that the term “Paidal Godown” was commonly used for a State Godown which was located in the hilly region which is not accessible through motor transport, but where the food grains under the PDS is transported either by head load (labour) or through Khacchars (mules).  The Committee by letter dated 15.12.2008 had specifically asked the State to give the list of inaccessible areas in the State of Uttarakhand, however the reply to the same has not been received till date. 

 

4.7     Advance allocation in inaccessible regions in Uttarkashi         District:

 

A.      The committee during the visit to the State in June 2008 was informed by the District Supply Officer (DSO) of the Uttarkhashi District that in monsoon the department sends an advance allocation to the interior godowns for three months so that the food grains can be sent to remote villages on time, since in rains the roads in hills get blocked.  The provisions for advance allocation is required seeing the inaccessible conditions of terrains during monsoon and winters. The Committee was informed that approval of Central Government has to be obtained before making advance allocation. Normally there is delay in obtaining the approval from the Central Government on part of RFC (Head of Marketing Wing) as they do not deposit money in time with FCI even after getting the requests from the concerned DSO.

 

B.       In the Uttarkhashi District where the Committee had visited, there are two regions namely the Gangotri and Yamnotri regions where there are inaccessible areas and paidal godowns. The following table will give a brief outlook of the number of godowns in the district and also the paidal godowns:

 

4.8     State Internal Godowns in Uttarkhashi District

 

Godowns fed by

Rishikesh Base Godown

 

 

Godowns fed by

Vikas Nagar Base Godown

 

1.                 Chinali Swat

Parola

2.                 Vanchera

Aarkot

3.                 Uttarkhashi

Badkot

4.                 Dhaunti

Naitwal

5.                 Nautala

Dhoni (Paidal Godown)

6.                 Bhalwadi

Taluka (Paidal Godown)

7.                 Jhala

Jhakol (Paidal Godown)

 

4.9     The Committee visited the Uttarkhashi district in the month of December to find out the manner in which the distribution of the food grains takes place in the inaccessible areas. However, the committee could not visit the place during the season since the roads leading to those godowns were already blocked.    

 

4.10   The transportation of the food grains in the inaccessible areas is really difficult during the monsoon and winter season, so every effort is to be made to ensure that the food grains reach before the season would set in, as once there is rainfall or snow then it is difficult for the Khacchar or the labourers to transport the food grain.  The Committee was informed that the State was bearing the transportation cost in respect of the movement of the food grains to the State Godown and that Central Government was not giving any subsidy to the State.

 

4.11   The biggest problem in respect of the inaccessible area was the delayed delivery of food grains in the Paidal Godowns. During the time of monsoon and winter season the areas in question get completely inaccessible. The committee was informed that many villages in the inaccessible areas get completely cut off and in fact it was informed by some locals that the villagers in these areas collect all the necessary things in advance and do not come out of their houses for the entire season especially those in Kumaon region. The DSO Uttarkashi informed that in such circumstances the ideal time to send the food grains to these villages is one month before the season sets in. However, the DSO Uttarkashi stated that in the past two years the district has faced problems of delayed allocation and that food grains have been transported even after the season has set in.  The DSO Uttarkashi also showed the committee the communication between the District Office and the main office which clearly showed that the district office had sent the requirement two-three months in advance but the Marketing Wing had sent the orders for advance allocation few days before the season was to set in. For example, for winter season the Uttarkashi District office had sent the intimation in September 2008, but the release orders were issued only on 1st December 2008.  The local media in the district also keeps a track on the advance allocation, which is evident from one of the press reports indicating the delayed allocation in the inaccessible areas. 

 

4.12   The Committee enquired from the Marketing Wing of the State (the wing is headed by Regional Food Controller who looks after allocation) regarding the delay in allocation, however no satisfactory reply was given by the department. The Committee was merely informed that permission is required from the Central Government before the release of advance allocation; however, the said permission in this case was sought only on 18.11.2008.  The Marketing Wing which feeds all the godowns in the District through its base godowns stated that they wait for intimations from all the Districts having inaccessible areas before sending the request to the Central Government. Normally there is delay in obtaining the approval from the Central Government on account of the fact that the RFC does not deposit money on time with FCI even after getting the requests from concerned DSO. The procedural requirement is one of the main reasons for delayed advance allocation. The DSO Uttarkashi had suggested that advance allocation should be automatic and should not be subject to procedural requirements. In other words, the Central and the State Government should automatically release advance allocation one month in advance so that the concerned Districts Offices would ensure that the same is lifted and delivered to the fair price shops in time. DSO Uttarkashi fairly admitted that if the allocation does not reach the village in the inaccessible areas in time, the villagers would not have any food to eat as they are totally dependent on PDS ration.  The following dates would give a clearer picture regarding the delay in releasing the advance allocation: 

          22.09.2008:  A paper cutting in Danik Jagran stating that the State Godown does not have the ration for the winter season.

 

          23.09.2008:           DSO Uttarkashi sends the requisition for Advance Allocation.

 

                           

          06.10.2008:  The District Magistrate’s communication in respect of the news report.

 

          25.10.2008   DSO sends a telegram reminding the officials about the advance allocation.

 

        18.11.2008   The RFC sends a letter to the Central Government for release of advance allocation

 

12.12.2008   Advance allocation is released after getting sanction from the central government.          

 

4.13        DSO, Uttarkhashi informed the committee that once the advance allocation reaches state godown in these areas, the department officials present distributes the entire advance allocation to the fair price shops who in turn distribute it to the consumers. When the committee asked as to how the department ensured that the fair price shops had properly distributed it. The DSO in reply stated that the only way to confirm the proper distribution was the report of the sarpanch. He further added that normally in such extreme season the fair price shop dealer would not think of diverting the food grains as the whole village depends on the PDS ration.

 

4.14        The DSO, Uttarkhashi informed the Committee that there were APL cards also in the  inaccessible areas and in order to ensure that they get full quota of the ration the District Magistrate requests the godowns to make adjustments to ensure that APL in inaccessible areas are also given full quota. As and when additional quota is released the same is utilized for this purpose as well.  However, Committee is of the view that all families in inaccessible areas where Paidal godowns exist be treated as BPL.

 

4.15   Advance allocation for 3 Months during difficult seasons in    Pithoragarh, Kumaon

A.      Foodgrains is allocated to Internal Godowns situated in inaccessible areas in advance for 3 months during Rainy season i.e. June, July, and August and also during winter season i.e. for the month of November, December and January. Inaccessible areas means those areas where the transportation is done either by mules or sheep and where due to various problems of rainy season like landslide etc or because of blockage of roads   on account of snow fall in winter it is not feasible to  transport goods by trucks.

 

B.       The advance allocation of foodgrain is adopted by the State Government due to the regional difficulties. Ucheti, Shirdang, Hokra and Namik are few areas in Pithoragarh district where foodgrains are allocated for 3 months in advance during difficult seasons. 

 

C.       Committee enquired about the time by which the foodgrains reaches in the godowns situated in inaccessible areas. DSO Pithoragarh informed that foodgrains reaches the internal godowns situated in such inaccessible area by first week of the month normally. However regarding advance allocation DSO Pithoragarh further informed that a letter was sent to RFC Haldwani regarding advance allocation of foodgrains on 28th April, 2008 but no such allocation was made in time.

 

4.16   MIGRATORY GODOWNS

 

A.      There are some hilly inaccessible areas in Uttarakhand where the population does not reside for whole year and they shift to base areas during winters as the places become too cold to live. They usually reside in the high mountains from May to October and move to plains or foothills from October to April. This migratory population includes shepherd families also who are traders of wool, carpets etc.  As they shifts down from Mountains to the foot hills for approx 6 months State government has made provisions for Migratory godowns in those areas. Migratory godowns are those godowns which shift to hilly areas during the summers and shifts to base areas during the rain and winters.

 

B.       Committee was informed that Burfu , Gunji , Dugtu, are few areas in Pithoragarh District where migratory godowns exist.  Population residing in Gunji and Dugtu moves down to Dharchula and those residing in Burfu moves down to Munsiari. For the month of May they withdraw foodgrains from base area and from June onwards  they withdraw ration in Hilly areas. FPS shops also runs for 6 months in these areas. However these shops are permanently allotted. Regarding cancellation of these shops usual practice is followed that is in case of irregularities Gram Panchayat can recommend for cancellation of shop. For Gunji base godown which is situated at Pangla, grains are caried by sheep or mule. Base godown for  Dugtu is situated at Tawaghat and for Burfu  base godown is at Munsiary. In Burfu only APL families reside.   These are shephered families who are traders of wool. In these areas FPS owners usually lift foodgrains from godowns at one go for six months.  It is the option of FPS owners whether he wants to lift for one month or six months.  Seeing difficulties of transportation in these areas  such options are given to FPS owners.  FPS owner normally give one month’s allocation or at the most two months allocation to the beneficiary at a time.

 

C.       Committee asked DSO Pithoragarh about the date of dispatch of  quota from Tawghat base godown to hilly inaccessible  area (Dugtu) and at what date it reaches  internal godown at Dugtu.  DSO Pithoragarh informed that no such record is available in his office and stated that this record is only available in those godowns (Tawaghat base godown and Dugtu internal godown).  He further informed about the transportation contract with the mule owners to carry the foodgrains from base godowns to internal godowns.  As per the said contract mule owners (Transporters) are bound to deliver foodgrains to internal godowns within one month of lifting the same from base godown.  He further informed about the entitlement of beneficiaries and stated that BPL and AAY beneficiaries gets full quota of foodgrains i.e. 35 Kg.  However, APL families are not given full quota.  Committee asked whether there is any Government order seeing that APL in inaccessible areas shall get full quota to which DSO replied that there is no such Govt. order.   He informed that DM fixes transportation rates and presently the transportation rate from base godown to internal godown (i.e.  Govt. godowns) is Rs. 870/- per quintal in case of transportation from Munsiari to Burfu.

 

4.17        Storage and Godown conditions

 

A.                There was no electricity and telephone connection at the godowns in Uttarakhand.  In Rudraprayag Committee was informed that earlier there were telephone in Rudraprayag godown but the same was disconnected because of non-payment of bills.  An FPS owner will not know when the foodgrains has arrived.  He has to make unnecessary trips in this connection whereas the FPSs are located at far off places.  In two cases it was found that FPSs are located at a distance of about 40 kms. Godown to be electrified and telephone facility be provided. None of the godowns has an electric connection. The Committee was informed that the proposal for electrification of godowns was shot down on the ground that sugar is also stocked in the godowns and sugar is inflammable. The Committee does not agree with this and recommends that telephone and electricity must be provided in every godown with sufficient safeguards for storing foodgrains and sugar.

 

B.                 During one of the visits the Committee visited the interior Godown Rudra Prayag (Garhwal Region). The Godown incharge Mr. R.S. Rawat was found present there. The Godown consisted of two sheds and a small office. One of the sheds was in disuse because it was in a very dilapidated condition. Mr. Rawat informed the Committee that he was also looking after another Godown which was about 15 Km away. On inquiry he stated that the records of the other Godown were also kept by him in the Rudraprayag Godown for the sake of convenience. While the Committee was inspecting the Godown one truck came to the Godown and on questioning informed the Chairman that he had come from his village to take 10-12 bags of wheat. On being asked if he was the owner of the FPS he said the owner was not with him. The Committee checked the records of the Godown. The inspector incharge of the Godown tried to explain that the quota of the FPS was about 63 quintals. However, the records revealed that the FPS had already taken his quota of wheat for the month of September on 19th and 26th September. While the Committee was making inquiries from Mr. Rawat and while checking the records the driver ran away from there with the truck.[4]The Committee found that there was electricity in the godown but there was no telephone. On enquiry the godown incharge informed the Committee that the shop keepers inquire from him about the availability of stocks on his personal mobile phone.

 

C.                 In another visit to a State Godown, the Committee observed that one of the problems, which existed, was lack of staff.

 

D.                During one of the visits to a State Godown in Haridwar, the committee found that the Bank Challan was filled by the Chowkidar (Mr. Chain Singh) whereas it is actually the duty of the inspector but he only verifies them[5].  In Dehradun Committee observed that one Godown Incharge has to look after the godown and also the shops in his area. As he was to look after the godown he was unable to travel in the field.

 

E.                 During Committee ‘s visit to Daniya in Almora, Committee received a complaint  that even on 27th February 2009 foodgrain for the month of February  had not reached the internal godown. On inspection of the godown it is found that  some stock has arrived only on that day. Stock was issued only to few shops and Godown incharge said he is not issuing stock as he will issue stock to all FPS only after receiving full quota. This plea of not issuing  Foodgrain to FPS  because  he is waiting for full quota to arrive so that he can issue it together to all FPS appeared unreasonable and is not tenable.

 

4.18         Visit to Mehra Block Godown , Nanital

 

Godown Incharge :- Mr. J.C. Kandpal

Godown Chowkidar :- Mr. Mohan Singh Rathore

 

During the visit to the Godown, Committee observed the following points:-

1.                 Weighment was manual; 50 kg bag can be weighed at a time.

2.                 There was no provision for electricity in the Godown.

3.                 Food grain is procured locally by State government (RFC) under decentralized procurement scheme. In case there is shortage of food grain, they receive through FCI. Usually only Mid Day Meal (MDM) food grain is issued by FCI.

4.                 Regional food controller looks after procurement and after procuring food grain the same is placed under the control of Supply wing which is distributed by them to FPS. The supervision of the functioning of FPSs is also done by the Supply Wing.

5.                 In the month of February godown received stock of February from base godown on 2nd, 3rd, 9th, 10th, 11th, 22nd, 23rd , 24th February 09.  This clearly shows that FPS owners do not get food stock in time.

6.                 In charge of this Godown was also in charge of another Godown in Sarna Block. So he has made arrangement that for first 3 days in a week, he is available at Mehara Village Godown, and for the next 3 days, in the Sarna Block Godown.

7.                 FPS owners come on the fixed days for taking the delivery of the food grain. But sometimes, food grain is not available on these days also for any reason which results in great difficulty to FPS owners especially when his shop is situated at a distance.

8.                 Committee observed that foodgrain can easily be taken out of bags using khurpi.

9.                 Bank Slips are available in the Godown. Godown in charge fills the slip detailing the FPS allocation for the month and then FPS owner deposit that slip along with money in bank. After showing the receipt, Godown in charge releases the quota.

10.             Some FPS owners come from a distance of 40 KM for taking the delivery of food grain but sometimes the stock was not available or the Godown was closed. Thus they face problems. Godown Incharge should be duty bound to inform the FPS owner that foodgrains has come / ready for distribution. Godown Incharge stated that he has his own personal Mobile phone. FPS owner can ask whether stock has come or not. Instead of FPS calling Godown Incharge, Godown Incharge should inform FPS, which will be more practical. As Godown Incharge is not reimbursed for making calls from his personal mobile phone so he was not prepared to call the FPS owners.  DSO, Pithoragarh stated that he is unable to contact Godown Incharge as there is no telephone facility in godowns.  Either they leave messages in SDM Office or if Godown Incharge has mobile they contact on mobile.  Thus, the Committee observed that telephone facility should be provided in godowns. 

 

4.19   Weighment: When food grains are transported from FCI to Base Godown weighment is done on weighbridges. No weigh bridges  are there (either manual or electronic) in any of the State Godowns to cross check the weight of the food grains received from FCI. One or two bags are weighed and rest are presumed to be of the same weight.  No weighment of the bags is done at the time of delivery to the FPS owner. Each bag is presumed to be containing 50 Kg. In fact there is pilferage from each bag at every stage. This is possible as the bags in which food grains are supplied are made of jute. It is very easy to poke a jute bag with a Khurpi and take out some grain.

 

4.20   Infrastructure in godowns: The committee observed that there was no computerization of any sort in the godowns and the godowns did not have a telephone connection.  In the godowns where the computers were installed by the government, either the said computers were not working or there was no operator to use them. The Committee found that a computer system was installed in the State Godown in Dehradun but the same was not connected with internet and was only used for storing data and taking printouts. In another state godown in Roorkie, Computers system is installed in the premises but their was no operator to operate the same.

 

4.21   Sampling: The Committee further observed that contrary to the provisions of the Uttaranchal Scheduled Commodities Distribution Order, 2003, the State Godowns are not making available any samples for the fair price shop and they themselves are not getting the samples of the stock they receive either from the Base Godown (in case of a internal movement) or from FCI Godown.

 

 

V.      OBSERVATIONS/INFERENCES  

 

5.1     The following are the conclusions of the Committee:

 

    A.            The Committee observed that the biggest problem in inaccessible areas is the delay in issue of release orders and delivery of the advance allocation. The mere fact that the department does not take measures in time shows the lack of coordination and planning between the District Offices and the RFC’s office

 

     B.            There should be some deadlines by which the Districts having inaccessible areas should send their requisition and some time frame within which the RFC should act and get the permission from the Central Government for release of advance allocation.

 

     C.            The Committee is of the view that the Central Government should delegate the powers of advance allocation to the State Government.

 

    D.            The advance allocation should reach the state godowns in the inaccessible areas at least one month in advance before the season sets in. For example in case of monsoon season it should be June and in case of winter it should be November.

 

     E.            The fact that there are many card holders in these inaccessible areas who fall in the APL category itself raises the issue as to whether “location vulnerability” should be the criteria for identification of BPL cards.

 

      F.            There is complete lack of infrastructure in the State Godowns, i.e. no telephone connection, no stationery etc.

 

    G.            There is no system of quality checking. No samples are issued by the base godowns or by the interior godowns.

 

    H.            No weight check memo is issued from the base godown or interior godown

 

       I.             In hilly region the Sale is opened at the godown itself and Circle inspector does not open the same at the shop and in Rural Areas, Gram Panchayat looks after the distribution of the food grains and the distribution certificate i.e. “Form A” is certified by the Gram Pradhan.

 

      J.            The state Godowns located in the hilly regions maintains the list and details of the Fair Price shops both situated in high and low terrain; Further in that same list they also maintain the record of the mode of the transportation ( i.e. truck , khachchar, or labour) along with distance and rate of transportation  per km.

 

     K.            Lack of support staff and poor maintenance of the godowns

 

      L.            There is no computerization in most of the state godowns and if at all a computer is installed in a State Godown, the same is not in operation.

 

 

 

 

VI.     OFFICE OF THE DISTRICT SUPPLY OFFICER

 

6.1             State of Uttarakhand is divided in 13 districts, and every district has a separate department unit known as the District Office. Every district is further divided into circles.

 

6.2             The District Office is headed by the District Supply Officer and he is assisted by Inspectors who look after the functioning of the Public Distribution System in the circles.

 

6.3             The Committee visited the District Supply Offices of various districts and also met the officials of the various circles of the respective districts. The nature of problems at every district office is different, therefore, in order to give recommendations for improving the working of the District Supply Office, it is necessary to give a summary of observation at some of the district offices visited by the committee.

 

6.4     DEHRADUN DISTRICT SUPPLY OFFICE: The District is divided into 11 circles namely

a)                  7 circles in Dehradun city

b)                  1 in Mussorie

c)                  1 in Rishikesh

d)                  1 in Vikas Nagar

e)                  1 in Doiwala

 

There are 16 sanctioned posts of inspectors, however, the Committee was informed that the sanctioned posts were not filled up and therefore the inspectors were not able to give proper attention. The officials maintained the records in respect of allocation of food grains in the circle, distribution of food grains in the circle, rations cards details of all the holders in the circle, details of fair price shop licencees in the circle. During the meeting with the circle inspectors on 20.6.2008 following were main points that were submitted by the officials:

 

1.      There is a lot of political interference at the time of allotment of fair price shops. Most of the BPL cards are issued under political pressure and most of the documents submitted by the applicant are false. The inspectors are under tremendous political pressure to issue BPL rations cards

 

2.      Due to lack of force and additional work no vigilance is kept on the FPS

 

3.      Some of the inspectors stated that there was threat to their life and property, in case they maintain vigilance on fair price shops or take any action against the fair price shops. This submission was specifically from lady inspectors that it is difficult for them to visit fair price shops without adequate security.

 

4.      The inspectors should be given appropriate transportation facility to enable them to move from one place to another to ensure implementation of PDS in their circle.

 

5.      Sh.R.N Bhatt, Inspector of Department of Food and Civil Supply informed that there is acute shortage of the inspectors, therefore it was difficult for the inspectors to visit every FPS. He further submitted that  many  Food Inspectors   are working as Inspectors since 1973. He further said that  there are around 900 FPS dividied in 11 circles and handled by 15 inspectors. He further informed that an Inspector gets Rs 100 per month as transport allowance though the actual cost of travel is much higher if proper field visits are done. He further informed about the problems of inspectors in visiting FPS in hilly areas  because of old age.

 

6.5       UTTARKASHI DISTRICT SUPPLY OFFICE: The Uttarkashi district falls in the upper hill region of the State of Uttrakhand where all the villages irrespective of whether they are connected or not are on high altitude. In this district there are some base godowns (godowns in which food grains are brought directly from FCI). All Base Godowns of Uttarkashi district are under the supervision of the supply department. i.e. the same are looked after by the office of the District Supply Officer. The Committee was informed that in the said district there are 14 regional godowns (both base and block godowns), 2 rail gates (from where food grains are received by train), 6 tehsils and the whole district was divided in to 4 regions. He further informed the committee that the department had sanctioned only 16 posts of inspectors for the District, out of which only 12 posts are filled. It is pertinent to mention that Shri K.S. Pawar, who is temporarily handling the post of the District Supply Officer, was only an inspector. It was further admitted that since the strength of the inspectors was less and they have to manage both godowns and field, therefore the villages in the higher hill terrain are never inspected and that they do not have any records regarding distribution of food grains in those villages. The Committee enquired about the mechanism for allocation of food grains to a fair price shop. The District Supply officer informed the Committee that the Sarpanch/ Panchayat of the respective village in which the fair price shop is situated gives a certificate after verification that the previous month’s allocation was properly distributed.

 

6.6       TEHRI GARHWAL DISTRICT SUPPLY OFFICE: Senior Marketing Inspector (SMI), Rishikesh informed the Committee on telephone that the officers at Tehri Garhwal have voluntarily not collected the samples from the main godown, whereas the inspector deputed on behalf of Tehri District at the Rishikesh Godown stated that he had no knowledge about the notification and regulations on collection of samples. He further stated that samples are not given to the other similarly situated hilly districts.

 

6.7              PITHORAGARH DISTRICT SUPPLY OFFICE: There are 6 subdivision in Pithoragarh. Pithoragarh, Didihat, Berinag,Gangolihat, Dharchula, Munsiari. Dharchula and Munsiari are situated in high mountain region and most of the inaccessible terrain/villages comes under this region.

 

6.8              Ucheti, Shirdang, Hokra, Namik, Burfu Dugtu, gunji are few areas which are inaccessible areas in the above said two subdivisions. Food grain is transported to these godowns through mules or sheep. The Committee observed that in Darchula Sub-division and Munsiary Sub- Division it is practically very difficult for one person to manage three godowns in view of the inaccessible areas under these sub-divisions. Thus it appears that number of post / staff position is not sufficient. The distance and inaccessibility of different locations of godowns in these two divisions indicate that it is not humanly possible for one person to handle three godowns. 

 

6.8.1        In Dharchula Sub Division Tawaghat, Pangu, Dugtu is under one supply inspector Shri S.L. Madhukar who is godown incharge . Tawaghat is inaccessible area and Pangu is 26 Km from  Tawaghat, Dugtu is 25 to 30 Km from Tawaghat. Similarly Pangla, Shirdangu, Gunji are under one godown Incharge Mr. Pushkar Singh Bonal, who is Clerk.  Shridang is 27 Km from Pangla, Gunji is 23 Km from Pangla.

 

6.8.2        In Munsiari Sub- Division also Sub Inspector Jogaram is godown in charge of 3 godowns.  Tejam, Hokra, Namik.  Hokra is 22 Km from Tejam, Namik is 24-25 Km from Tejam.  Both Hokra and Namik are inaccessible areas.  Similarly Mr. Subhash Pande is godown in charge of Munsiary godown, Ucheti godown and Burfu godown.  Ucheti is 27 Km from Munsiary, Burfu is 45 Km from Munsiary.  Munsiary is connected by road.  Both Ucheti and Burfu are not connected by road and are inaccessible areas. 

 

6.9              District Food and Supply officer of Pithoragarh informed that date of dispatch of foodgrains from base godown to Internal godown and date at which foodgrain reaches internal godowns is not available at his office. As no such record is maintained in his office. Such record is available only in concerned godowns. Therefore it is apparent that DSO office is unable to supervise the allocation and movement of foodgrains and it is totally under the control of Godown Incharge. There is shortage of Supply Inspectors (who are also godown Incharge) and as there is no monitoring at the time of movement of foodgrain from godowns. Pilferage and diversion of food grain thus takes place during transportation.

 

6.9.1      Pithoragarh district has similar problem as in Almorah.  The Committee met NGO, Women Self Help Groups.  The Women Self Help Groups in particular expressed their desire to run FPS themselves.  However, they were told that there is very nominal profit.  It was further stated that they prefer selling Atta(flour) rather than wheat to be supplied/distributed under PDS.

 

6.10     Under PDS Control Order 2001, it is the obligation of the State Government to ensure monitoring of the functioning of the Public Distribution System at the fair price shop level through the computer network of the NIC installed in the District NIC centres and to issue for this purpose computerized codes to each FPS in the district.

 

6.11     During the visits the Committee observed that there is no computerisation of any sort in the district offices, except in few offices where computers have been installed. However, during the visit the committee was informed that the department was under the process of computerising the database of the fair price shops, which included allotment of computerised codes to the fair price shops. 

 

6.12     During the meetings, the Committee came to know that the Chattisgarh computerisation model was being considered and studied by the department for the State of Uttarakhand. The Committee was also informed that there is a district NIC centre in all the districts and that the Food Secretary does video conferencing with all DSO’s once a month.  

 

6.13     Observations/Inferences

 

a)   Shortage of Inspectors, staff which gives an excuse to the department officials for not carrying their assigned duty.

b)   Overload of work on the inspectors especially in the hilly region.

c)   Lack of computerisation in the District Offices

d)   Lack of maintenance of records (especially for the fair price shops in the interior hill region)

 

 

VII.   DIVERSION

 

7.1             Diversion of food grains take place at every level of the system. The different ways in which diversion takes place would show that Government Officials, Godown Incharges, Transporters and retailers are all involved in the diversion of food grain in some manner or the other. The malady of diversion is prevalent in the system at such large scale that it has become a menace and threat to the system.

 

7.2             The first and foremost reason for diversion is the difference in the price of TPDS grain and market rate. This serves as an incentive for the unscrupulous persons connected with the implementation of the system to connive with the traders to divert the TPDS food grain into open market. The difference in price is also an incentive for people who are not otherwise eligible under the scheme to get the benefit of the lesser rates of grain.

 

7.3             The second reason for diversion is the lack of any system of accounting for the grain allocated under the system. Ideally there should be a system by which the grain allocated to the State can be equated with the grain distributed to the beneficiaries. Since the scale of distribution and the number of beneficiaries is very large this can not be achieved manually. Thus, there is need for complete automation and computerization of the Public Distribution System.

 

7.4             The third reason for diversion is that the functions of implementation, enforcement and vigilance are not clearly demarcated and implemented.

 

7.5             There are two ways in which diversion takes place. Firstly by selling the TPDS grain in the open market, and secondly by substituting the TPDS grain by grain of inferior quality.

 

7.6             Bogus ration cards come into existence in several ways. Some of the ways are enumerated below only as an example. The list is not exhaustive.

1.                 By using the cards of the people who are dead or have changed residence.

2.                 Obtaining a ration card at temporary place of residence or by showing residence at some place falsely.

3.                 Breaking up the family into smaller units

4.                 Duplicate ration cards issued in the name of persons who are already issued cards.

5.                 Ration cards issued in fake names and at fake addressees.

 

7.7             A suggestion was received by the Committee to link the issue of ration cards with the voters list. This measure may help in reducing the bogus cards only to some extent. The correctness of the voters list itself can not be vouched for as the incidences of having bogus voters in the voters list is same if not more than the incidence of bogus ration cards. Issue of ration cards to the intended beneficiaries is a process which requires proper care and scrutiny by the field staff. State Governments should lay down strict guidelines for issue of ration cards and the officials responsible for issue of ration cards should be made accountable for any bogus card found in their jurisdiction. The Central Government has sponsored the Haryana Government and Chandigarh Administration to start a computerization project which includes introduction of smart cards with the biometrics of the card holder and his family members. This Committee has recommended computerization of the TPDS in the report relating to Delhi. This issue is further discussed in detail in the chapter on computerization in this report and in the separate report submitted to the Hon’ble Court on the issue of computerisation. The suggestions therein may be read as part and parcel of the report.

 

7.8             Food grains are packed in Jute bags. Bags contain mark of FCI with logo and stitching is done by using coloured thread. The jute bags are good to hold the weight but it is common practice during handling, loading /unloading that labour use iron hooks to lift bags. The hook is pricked in the bag and bag gets damaged and so there is lots of leakage of foodgrain during the handling. Moreover by use of khurpi  which is prevalent every where foodgrains can be taken out of jute bags without  tearing bag/ opening bag and it is easy way to pilfer foodgrains from a bag.

 

7.9             The weighing systems at different levels also provide large scope for diversion. The Committee found that that at most places manual weighing scales of very small capacities are used.

 

7.10        The Committee found that there was no system of quality control in the state. No samples were found even at the whole sale distribution points. No samples were supplied to the retailers. There was no check on quality of grain being supplied to the beneficiaries.

 

7.11        To do away such malpractices foodgrains can be packed in smaller bags of 5 or 10 kg so that PDS commodity is supplied in pre-packed small HDPE bags to the consumer. PDS foodgrain should be packed in non pilferable, tamper proof bags of smaller sizes. Rice and wheat floor is sold in open market by private companies in such smaller HDPE packaging.

 

7.12        The general awareness of the beneficiaries, high literacy and strong grass root level organisation and strong vigilance Committees are the important factors to reduce leakages. Strong Political commitment and careful monitoring by the bureaucracy are the key elements for successful PDS. Leakages happen due to wrong identification, theft and diversion of grain by officials involved in distribution system.  It requires strong political commitment and participation of the people in delivery process. The nexus between officials, the mafia and ration shop dealers must be broken in order to reduce leakages. Monitoring and accountability of TPDS can be improved by automation and computerisation of the PDS system. TPDS needs to be strengthened by means of the effective use of IT including introduction of unique biometric smart cards.

 

7.13        The retailers also indulge in diversion. APL food grain can be easily diverted by them as already explained. They also use bogus ration cards for diversion. Besides this the committee received complaints showing that the FPS dealers retain the ration cards of the poor people and indulge in short weighing. As a matter of fact diversion at any stage has to be ultimately accounted for against some ration card. This makes the FPS licencee an accessory to all diversion done at any level and provides scope for him to indulge in diversion on his own.

 

7.14        There are provisions in the PDS Control Order, 2001 regarding quality Control. It is provided that the State Governments shall make arrangements for taking delivery of essential commodities issued by the Central Government by their designated agencies or nominees from the FCI Depots/godowns and ensure further delivery to the fair price shop within the first week of the month for which allocation is made. Before making the payment to the FCI the representatives of State Governments or their nominees and the FCI shall conduct joint inspection of the stocks of foodgrains intended for issue to ensure that the stocks conform to the prescribed quality specifications. The FCI shall issue to the State Governments stack-wise sealed samples of the stocks of foodgrains supplied to them for distribution under the Public Distribution System at the time of dispatch. State Governments shall exercise necessary checks to ensure that full quantity lifted by them reaches their godowns and in turn the fair price shops and is not replaced by stocks of inferior quality during storage, transit or any other stage till delivery to the ration card holder.

 

7.15        It is suggested that there should be complete automation of weighing systems at all levels. Weigh Bridges should be used at all FCI and State Whole Sale Distribution Points. These weigh Bridges should be connected to computer systems to generate weight check memos automatically. Stock inventories should also be automatically generated. The system of sampling should be strictly observed. The State Government has to obtain stack wise samples from the FCI after a joint inspection of the grain. The wholesale distribution point must issue samples to the retailers to show the quality of grain supplied. The retailer must display the sample at his FPS shop so that the quality can be checked by the officials, vigilance machinery, enforcement machinery and the consumer.

 

7.16        It is felt that in case TPDS food grain is packed in non pilferable, tamper proof bags of 10kg and 5 kg the same can be delivered to the beneficiary in sealed packing.  This measure along with automation in weighing and use of computerization and smart cards would go a long way in eliminating or at least reducing pilferage. It would also ensure a more hygienic handling of food grain and help in ensuring that the food grain of proper quality reaches the beneficiary.

 

 

 

 

 

*******

 

 

 

 


CHAPTER 4

 

RETAIL DISTRIBUTION

 

              The present chapter deals with the following aspects of the retail distribution.                                     

 

          I) Mode of appointment of fair price shops

          II) Viability of fair price shops

          III)  Functioning of fair price shops

         

I.       MODE OF APPOINTMENT

 

1.1     Uttaranchal Scheduled Commodities Distribution Order, 2003

 

        i.            Clause 3 of the Uttaranchal Schedule Commodities Distribution Order, 2003 of the provides that in view of effecting fair distribution of the scheduled commodities, the State Government may issue directions to set up number of fair price shops in an area as it deems fit.

 

      ii.            Clause 23 of the Uttaranchal Schedule Commodities Distribution Order, 2003 further prohibits a fair price shop owner to appoint any person as sub-agent or transfer his licence to any other person and it further states that no other person apart from the licencee shall run the fair price shop. 

 

1.2             The procedure for the appointment of FPS Licencees is different in urban and rural areas and the same is as follows:

 

A.                      RURAL AREAS:

                                            i.      As per the government norms an FPS should have 2,000 units i.e. 400 cards.  If cooperative society runs FPS then there  can be 4000 units i.e. 800 cards attached to it.   In rural areas, Gram Sabha in an open meeting decides as to whether a fair price shop is required in that village or not, the assistant BDO supervises the meeting.  The Gram Sabha also decides and nominates the person for running the fair price shop. Once a nominee is selected, then the said candidate approaches the Sarpanch and BDO to get necessary certificates. BDO and SDM give their recommendation.   Minutes are given to the Block Development Officer (BDO) who forwards the same to DSO who finally checks the character certificate and financial situation of the person so recommended. DSO then forwards it to District Magistrate who passes the order. 

                                          ii.      As a rule there is a FPS for each gram sabha. Sometimes there may be one FPS for two or three gram sabhas. In such case the two or three gram sabhas choose the allottee jointly. Committee was informed that in Almora district  there is one shop for 2-3 Gramsabha’s. District magistrate is the authority to cancel and allot any FPS.

                                        iii.      If there are more than 4000 units in one Gram Sabha and Gram Sabha is of the view that there is need for another shop, then the new FPS owner is appointed by the consensus in the open meeting held for that purpose and the procedure is same.

                                        iv.      The committee was informed that usually there is lots of political influence in appointment and open meeting is just a formality and the name is decided prior to meeting.

                                          v.      The Licencee has to give security for Rs.250/- for shop in rural area and Rs.1,000/- for shop in urban area. 

                                        vi.      There are 1146 Gram Panchayats in Almora District and there are 797 FPSs.

                                      vii.      It was stated that in many cases 2 or 3 Gram Panchayats are attached to an FPS.   Committee observed that many shops were located in motor heads and such shops are catering to 2-3 villages.

 

B.                       URBAN AREAS:

i. In urban areas, a vacancy of opening of a new fair price shop is normally notified if there are 4000 units .Once a vacancy of a fair price shop is determined, an advertisement is published in the newspaper inviting applications. Once all the applications are received the circle supply inspector makes an inspection and on the basis of the report some candidates are selected to appear before the Selection Committee. The Selection Committee consists of the following

a)      District Supply Officer,

b)      District Magistrate/ Additional Magistrate,

c)      Chief Development Officer

d)      One nominee of the Revenue department.

 

ii.  Once the Selection Committee makes it recommendation, the same is forwarded to the DSO who checks the financial of the status and character of the candidate thereafter the same is forwarded to the Distrivt Magistrate, who passes the order and collects a deposit of Rs. 1000/- as security. 

 

iii.   As regards the eligibility of a candidate, to get FPS licence the committee was informed during its visits that there are no specific conditions for a candidate to be eligible except that he should be reasonably educated and should have a moderate bank balance. 

 

1.3              Political Influence in Appointment Procedure

 

A.                 One of the most common problems that the committee came across was the political interference in the appointment of the fair price shop dealer. During the public hearings it was submitted before the committee that in rural area the FPS licences are given by the Gram Pradhan on political considerations[6]. The shops should be allotted through the department of Food and Supply. During one of the visit to a village the Committee found a fair price shop which was completely managed and run by a Gram Pradhan and the people of that village were not getting any food grain from the fair price shop[7], though the records of the fair price shop indicated that food grains were appropriately being distributed to all the consumers.

 

B.                 In one of the files shown by the Department pertaining to the allotment of FPS  the committee observed recommendations of the political leaders either for opening a fair price shops or recommending a candidate for allotting a fair price shop to him. The committee specifically asked whether there was any requirement for a recommendation from local MLA or MP under the rules and circulars, to which the department replied in negative[8].  Committee is of the view that deletion and addition of cards attached to FPS be thoroughly  examined and reasons be recorded particularly at the time of change of Government or Gram Pradhan

 

1.4       Validity of Licence

 

A.        The licence so allotted is not restricted by any time period once a person gets the licence of running the fair price shop, his licence becomes perpetual. Thus, there is no renewal procedure in Uttrakhand. The Committee observed during its visit that there have been fair price shops where the dealer is an aged person and the shop is run by either his children or by some relative.

 

B.         The committee also observed that since the role of the Department of Food and Civil Supplies was minimal in the rural areas, the said system had a deeper impact in the hilly region. In the northern districts of the state like Uttarkashi, there are many villages located in the inaccessible area or in areas where a person has to trek 10 -15 kilometres, and in the said cases the department has no record of the fair price shop or its activity except for the certificate they get from the Gram Sabha which certifies that the fair price shop has sold its allocated quota. The committee also observed that in such cases, the department is also not able to put any check since they cannot allow a new fair price shop unless the Gram Sabha consents to it.

 

1.5       Suggestions/ Recommendations 

 

A.        Uniform Procedure of appointment: There has to be a uniform procedure for the appointment of the fair price shop dealers. It has been observed that the appointment of fair price shop in the Rural areas is done by the Panchayat of that village and the department does not interfere in it, whereas on the other hand in the Urban Areas the appointment of the fair price shop is done by the department following the procedure which has been explained above.   The State should have a uniform methodology for appointing fair price shop dealer, this suggestion is being made in the light of the visits made by the Committee where it was observed that licences for fair price shops in rural area are recommended by the Gram Pradhan on political considerations and the department did not play any substantial role. To cite an example in the northern districts of the state like Uttarkashi, there are many villages located in the inaccessible area or in areas where a person has to trek 10 -15 kilometres, and in the said cases the department has no record of the fair price shop or its activity except for the certificate they get from the gram Sabha which certifies that the fair price shop has sold its allocated quota.  However in Kumaon region Committee observed that Gram Sabha’s do not certify distribution of foodgrain by FPS and FPS  gets allocation of foodgrain for next month without such certificate. The opening of sale is not in practice as Supply Inspectors do not check the stock registers and do not open sale at FPS.

 

B.         Political Interference: During the visit of the committee to village Jagjitpur the committee met about 9-10 beneficiaries and each of them said that, Pradhan of the village is not a good person and if any beneficiary raised his voice for his share of food grains, the pradhan would openly come to fight with him.  The Committee observed that FPS owner in the ration card entered only the date on which the commodity was issued and did not mention the quantity and rate of the said commodity.  It has been observed that there is political interference in the appointment of the fair price shop Licences and in its functions both in urban and rural areas. However the possibility of political interference is more in the rural areas which is evident from the above cited example.   It is suggested there should be no political interference in any of the procedures involved in PDS.

 

C.        The department has to ensure that a new fair price shop is allotted when the minimum numbers of cards/units are available. During the course of the hearings it was observed by the committee that the minimum card rule is not generally followed while allotting a new fair price shop.  The committee was informed by the villagers of the villages located in the interior hills that they would not mind if they had to go to another village to collect their allocation, provided they get their ration on time. Therefore, if the minimum card rule is followed then it automatically would ensure that the fair price shop would become financially viable. This would also ensure that the beneficiary gets his full quota of ration at the price fixed by the Government. Therefore, the department should ensure that the card position should be rationalised as far as possible in a time bound manner and if there is any departure from the criteria of minimum cards then the said reason should be recorded in the file.       

 

II.      VIABILITY OF THE FAIR PRICE SHOPS IN EXISTING SYSTEM

              

2.1             Para 3(1) of the Annexure to the PDS Control Order, 2001 read with clause 5 of the PDS Control Order, 2001 states that the Central Government is to make food grains available to the State Government at a particular price that is specified from time –time. The state government adds its administrative charges on the central issue price and then allocates these food grains to the fair price shop at the prescribed rates. The fair price shop then sells the food grains at the rate prescribed by the State government.  The table below would give a general view on the prices at which the State buys from the centre and the price at which a fair price shop is expected to sell the food grains to the consumers.

 

 

 

 

 

 

Commodity

Central Issue price

Per quintal

Administrative charges

Per quintal

Issue price to the FPS

Per quintal

Commission

Per quintal

Selling Price to Consumers

Per quintal

APL Wheat

Rs. 610/-

Rs. 44/-

Rs. 654/-

Rs. 6/-

Rs. 660/-

APL Rice

Rs. 795/-

Rs. 44/-

Rs. 839/-

Rs. 6/-

Rs. 845/-

BPL Wheat

Rs. 415/-

Rs. 44/-

Rs. 459/-

Rs. 6/-

Rs. 465/-

BPL Rice

Rs. 565/-

Rs. 44/-

Rs. 609/-

Rs. 6/-

Rs. 615/-

 

AAY Wheat

Rs. 200/-

Nil

Rs. 200/-

Rs. 6/-

Paid after submissions of bills 

Rs. 200/-

AAY Rice

Rs. 300/-

Nil

Rs. 300/-

Rs. 6/-

Paid after submissions of bills

Rs. 300/-

 

 

2.2             Under the present system it is clear from the above data that in case of APL category the State Government buys wheat from the Central Government (Food Corporation of India) at the rate of Rs. 610/- per quintal. It adds Rs. 44/- per quintal to it, then sells the same to the fair price shop dealer at the rate of Rs. 654/- per quintal. The fair price shop dealer sells the same to the consumers at the rate of Rs. 660/- per quintal after adding Rs. 6/- per quintal as Commission. In case of rice, the State Government buys the same at the Rs. 795/- per quintal from the central Government (Food Corporation of India) and sells the same to the fair price shop dealer at Rs. 839/- per quintal. The fair price shop dealer sells the rice at Rs. 845/- per quintal after adding Rs. 6/- per quintal as commission. The said Rs. 44/- charged by the state government (department) is the administrative expenditure, which is primarily used for both maintenance of godowns and also for the transportation of the food grains from FCI Godown to State Godown and from one State Godown to another.

 

2.3             Similarly in case of BPL category the State Government buys wheat from the central government (Food Corporation of India) at the rate of Rs. 415/- per quintal. It adds Rs. 44/- per quintal to it then sells the same to the fair price shop dealer at the rate of Rs. 459/- per quintal. The fair price shop dealer sells the same to the consumers at the rate of Rs. 465/- per quintal after adding Rs. 6/- per quintal as Commission. In case of rice, the State Government buys the same at the Rs. 565/- per quintal from the central Government (Food Corporation of India) and sells the same to the fair price shop dealer at Rs. 609/- per quintal. The fair price shop dealer sells the rice at Rs. 615/- per quintal after adding Rs. 6/- per quintal as commission.

 

2.4             In case of AAY category the State Government buys wheat from the central government (Food Corporation of India) at the rate of Rs. 200/- per quintal and then sells the same to the fair price shop dealer at the same rate. The fair price shop dealer also sells at the same rate to the consumers i.e. Rs. 200/- per quintal. In case of rice, the State Government buys the same at the Rs. 300/- per quintal from the central Government (Food Corporation of India) and sells the same to the fair price shop dealer at Rs. 300/- per quintal. The fair price shop dealer also sells the same at Rs. 300/- per quintal. In case of AAY category the fair price shop dealer receives a commission of Rs. 6/- per quintal. It would be not out of place to mention that the fair price shop dealer also gets transportation cost from the department in respect of the AAY food grains. However during the visits it was observed that the transportation charges were not paid in time to the fair price shop dealers after they submitted their bill.   

 

2.5             As per the general rule a fair price shop dealer earns Rs. 6/- per quintal on selling the food grains under the Public Distribution System. The fair price shop dealer has to engage his own transportation, and he bears the cost of the same from this commission itself. However, the above rule stated is only applicable in plain regions of the state. As mentioned in beginning there is a dual system functioning in State of Uttarakhand.

 

2.6             In the hill region the fair price shop dealer uses various modes of transport i.e truck, mule, coolie since the shop is located in the interior region of the hills, as a result the fair price shop dealer incurs a heavy expense on transportation. The State Government, therefore, has made a provision called the transport subsidy under which the District Magistrate of the concerned district passes an order in which he specifies the rate of transport per kilometer per quintal in respect various modes of transport used in the hilly region. The fair price shop dealer is then accordingly allowed to add the calculated rate of transport to the selling price of the food grains. Therefore the transport subsidy as stated is actually an additional cost which is recovered from the consumers only. For example if as per the calculation the fair price shop is incurring Rs 100/- per quintal on transportation then, he would be allowed to add this sum to the selling price of the food grains. The selling price of food grains in such a fair price shop would be:

 

Commodity

Selling Price to Consumers

Per quintal

Selling price after adding transport cost

APL Wheat

Rs. 660/-

Rs. 760/-

APL Rice

Rs. 845/-

Rs. 945/-

BPL Wheat

Rs. 465/-

Rs. 565/-

BPL Rice

Rs. 615/-

Rs. 715/-

AAY Wheat

Rs. 200/-

Rs. 200/-

AAY Rice

Rs. 300/-

Rs. 300/-

 

 

2.7              To cite an example District Magistrate/Collector, Tehri by order dated 27.09.2003 fixed the following charges:

 

A.        Transport through Truck

Between 1- 5 km from Godown :   Rs. 8  per quintal

Between 6- 10 km from Godown:  Rs. 13 per quintal

Between 11- 15 km from Godown:  Rs.  18 per quintal

Between 16- 20 km from Godown:  Rs.  23 per quintal

Above 21 Km: Re. 1 per quintal per kilometre.

 

 

 

B.         Transport through Coolie: 

Rs. 06/- per quintal for 1 kilometre  

 

C.       Transport by mule(Khachchar):

Between 1- 5 km from Godown :   Rs. 10  per quintal

Between 6- 10 km from Godown:  Rs. 08 per quintal

Between 11- 15 km from Godown:  Rs.  07 per quintal

 

2.8     Administrative Charges

 

                    i.            The Committee in its earlier visits learnt that the State Government is charging Rs. 44 per quintal over and above the Central Issue Price while selling the same to the fair price shops. The Committee by its letter dated 15.12.2008 specifically asked for the expenditure heads on which Rs. 44 are spent.

 

                  ii.            The department handed over a statement which contains the different heads under which this Rs 44 is spent. The expenditure statement has been followed from the time when the State was a part of UP. The department also provided a fresh statement in which the department is proposing to increase the administrative charges by Rs. 50 per quintal.  Under the new statement the burden of the additional cost would have to be borne by the consumers only.

 

 

 

 

2.9     Income on the basis of the existing rate of commission         payable to the fair price shop

 

a.                  There is no uniformity in the selling price of the food grains.  The fair price shops of both plain and hilly region incur different expenditure and the factors for high cost are also different. Therefore, it would be slightly difficult to estimate their expense.  It has also been observed that the fair price shops in the hilly region get an additional benefit of adding their transport cost (calculated as per the rates fixed by the District Magistrate of that District) to the selling price. Therefore to some extent the fair price shops in the hilly region are relieved from the burden of the transportation cost. In this chapter the analysis on the viability of the fair price shop is being made purely on the basis of the assumption that the fair price shop dealer apart from the commission does not get any other benefit like the dealers in hilly region.

 

b.                 However, the commission given in the State of Uttarakhand is far less than what the fair price shops dealer are getting in Delhi.  It would be recollected that in Delhi the commission of a fair price shop dealer is Rs. 35 per quintal (Rs. 0.35 /Kg) whereas in the State of Uttarakhand it is Rs. 6/- per quintal (Rs. 0.06/ Kg).   

 

c.                  As per the norms mentioned above a fair price shop is opened only when there are 4000 or more units. If it is presumed that a ration card has 5 units then ideally a fair price shop should have approximately 800 cards.  Every cardholder irrespective of the category is entitled to 35 Kg of food grains. Therefore, a fair price shop having 800 cards will be entitled for 280 Quintals of food grains.

 

d.                 Apart from the income earned through the commission the fair price shop dealer sells empty gunny bags in the open market, which is sold at Rs. 5/- per bag. However, FPS owner in Nainital and Almora informed that price of one bag is Rs 7-8.

 

e.                  Therefore, if a fair price shop having 800 cards attached to it gets its full allocation as per the entitlement then following would be the income that the fair price shop dealer would have:

1.

Total No. of cards:

800

 

2.

Total Allocation (Both Wheat and Rice)

280Qtls.

 

3.

Commission per Quintal

Rs. 6/-

4.

Total Income generated from commission

280 Qtls X Rs. 6=  Rs. 1680/-

5.

Total Number of Gunny Bags

560 bags (Each bag has a capacity of 50 Kgs. of grains)

6.

Income from Sale of Gunny Bags (Rs. 5/- per bag)

 560 x Rs 5/- = Rs. 2800/-

7.

Total Income (4 + 6)

Rs. 4480/- per month

 

 

f.                   However, it has been found that the Central Government is not releasing full allocation in respect of APL cardholders. Presently the State Government is receiving only 14.6% of the total entitlement for release in respect of the APL cards or in other words Government is releasing around 5.136 Kg per card against the actual scale of 35Kgs per card[9]. In case of BPL Card holders, there is a 100% allocation done by the government.

 

g.                 The reduced allocation in APL category would mean that the income reduces by more than 50%. It has been observed that the number of ration cards attached to a shop and the allocation of food grains have a direct bearing on the income of the fair price shop dealer. The fair price shop dealer is entitled to only Rs. 6/- per quintal as commission out of which he has to bear the transportation and other maintenance costs. This is apart from the fact that there are very few fair price shops having 800 cards attached to them.

 

h.                 Therefore, the income of a fair price shop is too low to sustain and this low income is one of the main reasons for the fair price shop dealer to indulge in malpractices.

 

i.                    As per Government order dated 24.2.1992 the department of Food and Civil Supplies has identified 20 non essential commodities which a fair price shop can sell. It was further observed that the fair price shops in the State are also selling Kerosene Oil.

 

j.                   During the visits of the Committee, it was observed that all the fair price shops were running a regular kirana shop in the same premises. Therefore, it is not a case where the fair price shop owner is completely dependent on the sale of the food grains under the public distribution system.

 

2.10   Viability and Income of FPS in Kumaon Region

 

A.                There was common complaint of FPS owners that they get less commission. However, it is worth mentioning that even though they don’t get proper commission they are not ready to surrender shop. All FPS owners in addition are having Kirana shops which are doing well. One FPS owner stated that after selling food grains he is free and he does other business. He stated that why shall he open shop all the time when he sells foodgrain fully. He stated that those who run kirana shop can sit full day as they have to sell kirana items. It is pertinent to mention that they don’t surrender FPS shop as the fact is they get status in society and develop political connection. During a meeting at Haldwani FPS owners pointed out that Government is contemplating to issue Order, Ordinance whereby the FPS owners will be debarred from contesting any elections.

 

B.                 The question of amount payable to shopkeeper was discussed.   It was stated that shop-keeper is entitled to commission at fixed rates plus transportation charges.  For AAY food grains, transport charges are reimbursed to the shopkeeper.  The system is that a bill is prepared for the amount due to FPS owner for AAY   food grains transportation. The bill would be certified by the Pradhan of the Gram Panchayat in the rural area and in the case of urban area it is certified by the Inspector, which is then forwarded to DSO.  The bill in turn is presented to Senior Regional Finance Officer (SRFO)  at Haldwani.  (Some of the record shown to the Committee revealed that for FPSs of Nainital District, were paid the amount due to them for the year 2003-04 only in the year 2008). First objection was raised by the finance that the bill received was time barred i.e. after 3 years. The delay on the part of DSO was not explained,  rather it was stated that the bills were received late and certified late as there was shortage of staff.

 

C.                 For FPS owners of Almora district, payment has not been made since 2001.  The reason given by the Finance Controller was  that out of 20 FPSs attached to a godown, bills for 18 FPSs were received.  The bills were thus returned being defective.    No FPS in Almora has been reimbursed for the transportation charges for AAY food grains. It was complained that there could not be proper verification in as much as there was shortage of staff.  As facts are concerned, it appears there was no shortage of staff as there was only one vacancy at the stage of clerk and Head Clerk who has been promoted as Inspector.

 

2.11     Suggestions and Recommendations Received

 

A.      In all the meetings with the fair price shop associations, following problems were raised:

          i.        Less commission

          ii.       Low allocation of APL food grain

          iii.      High transportation cost

 

B.       It was also suggested by Shri B.D. Sharma, General Secretary in a meeting on 20.06.2008 that the profit margin or the commission given to the fair price shops should be increased to 10% - 15% on the sale price of the food grains.

 

C.       During a meeting with the fair price shop association, Dehradun the committee was informed that the fair price shops owners association   had    given a representation to the State Government for increasing     the commission, which the department admitted. However, upon    enquiry it was found by the Committee that the said representation   was still under consideration.

 

2.12   Observation / Inference 

 

A.                There has been a suggestion that the commission of the fair price shops should be increased to approx 2.5% to 10%. In order to improve the viability of fair price shop, the consumers should not be burdened and also no additional burden should also be put on the government. Therefore the following suggestions are made keeping in mind the said two factors.

 

B.                 Re-Identification of BPL Families: The general assumption is that the APL card holders do not avail their ration from the fair price shops. During the visits, the committee came across many families who though may not be poor but wanted to avail ration facility. The reason for the aforesaid conclusion is that in the State of Uttarakhand the maximum cut off to be a BPL cardholder is Rs. 9,000/- per annum. Therefore in all probability all the lower middle class families would be excluded. Once the BPL cards are re-identified on a fresh criterion, then the same would result in the increase of BPL cards and further leading in increase of allocation. Thus once the allocation increases the same would lead to increase in the income of the fair price shop.

 

C.                 The Committee has observed that the State Government keeps around Rs. 44/- per quintal as administrative charges. As per the version of the officials the department the same is used to maintain the State Godowns and is also used for the transportation charges for the internal movement of the food grains. It is the obligation of the State Government, under the PDS Control Order, to ensure door step delivery. In the light of this obligation it would be appropriate for the State Government to reduce the administrative charges, and the saving on this account may be used for increasing the Commission of the fair price shop owner facilitating the viability of the FPS.

 

III.    FUNCTIONING OF THE FAIR PRICE SHOP

 

3.1       Allocation of foodgrains to FPS

 

A.      Urban Area:

i.        The Committee was informed that the area inspector informs the fair price shop owner regarding the arrival of the food grains. In the urban area since the inspector visits the fair price shop therefore, he issues a “form A Certificate” indicating that the fair price shop has sold the entire last month’s allocation. The shop owner accordingly comes to the State Godown where he collects a bank slip from the in-charge and deposits the cash as per the determined allocation in the bank as indicated by the department. The committee was informed that normally the fair price shop owners deposit cash and only some give the money in drafts. . Once the money is deposited the FPS owner collects the food grains available. The FPS owner himself pays for transport and in some cases 3 or 4 fair price shop owners arrange for the transport together.

ii.       In the urban areas (in the plains) where the marketing wing is looking after the Godowns, the area inspector visits the fair price shop to open the sale. It was observed that the inspectors open the sale sitting at the office as if they had been visiting then many of the violations that were noticed by the committee in the fair price shops would have been detected by the inspectors as well.   However, in the hill region even in the urban areas, the area inspector is not able to visit the fair price shop since the department is also entrusted with the duty to manage the Block Godowns. In such cases, he issues the certificate in Form A at the Godown. The following registers are maintained by a fair price shop:

1.     Stock Register

2.     Sale Register

3.     Complaint Book

4.     Ration Cards   Register

 

 

B.       Rural Areas

        i.            The Gram Sabha manages the entire functioning of the fair price shop in rural area. Apart from allocation the Gram Sabha is also entrusted with the regular inspection of the fair price shops. The Committee was informed that once the monthly allocation of a fair price shop is determined, food grains is transferred from Base Godown to Block Godown. Then the fair price shop owner collects bank slips from the inspector posted in the Godown and appropriately deposits the required amount as per their respective allocation.  Most of the time the money was deposited in cash.  In case a fair price shop owner intends to pay in different mode then only Demand drafts are accepted. The State Godown maintains a register called slip register in which all the details regarding issuance of bank slips, deposit of money, the quantity allocated along with the signature of the officials is maintained.  The gram sabha, issues the form “A” certificate indicating that the fair price shop has sold all its previous month’s allocation.  It is only on the basis of this the department allocates the next month’s quota to the fair price shop.

 

      ii.            The Committee was further informed that some fair price shops of remote areas take two months allocation together, since the monthly allocation is low and the cost of transportation is very high. However, it was stated by one of the official that the said arrangement of fair price shops collecting two months allocation is not approved by the department formally but no action is taken since if the Fair Price Shop is sealed or the licence is cancelled then villagers of that area might have to trek and travel a lot to get their food grains.

 

C.       The District Magistrate, Rudraprayag in a meeting held on 28th September, 2008 stated that the fair price shops in hill regions do not lift their allocated quota every month and that they prefer to wait for 2- 3 months to lift since the cost of the transportation in hill regions is very high and the subsidy provided by the State Government is comparatively very low.  He suggested that the said practice should be discontinued and clear instructions should be there for lifting of allocated quota in that respective month.

 

D.                The fair price shop owner arranges transport for transporting the food grains from the State Godown to the fair price shop. In hilly region there are three modes of transport used by the fair price shop owners for the movement of the food grains namely Truck, mules (khachchar) and Coolie.

 

E.                 In the hill region the fair price shop owners use various modes of transport since the shop is located in the interior region of the hills as a result the fair price shop owner incurs a heavy expense on transportation. The State Government, therefore, has made a provision called the transport subsidy under which the District Magistrate of the concerned district passes an order in which he specifies the rate of transport per kilometer and also per quintal in respect of various modes of transport used in the hilly region. The fair price shop is accordingly allowed to add the calculated rate of transport to the selling price of the food grains. Therefore the transport subsidy as stated is actually an additional cost which is recovered from the consumers only. For example if as per the calculation the fair price shop is incurring Rs 100/- per quintal on transportation then, he would be allowed to add this sum to the selling price of the food grains.

 

F.                  During the Committee’s visit to Rudraprayag the committee was informed that one of the methodology adopted by the fair price shops in the interior hill is that the shop owner collects his monthly allocation from the State Godown and then carries the same to the road end where he keeps the same in a room overnight since carrying the food grains in the night is difficult. It is only on the next morning the food grains are actually transported to the interior hills. One of the grievances which was stated by the shop owners was that they should be given the rental of the room/Godown they hire for the transportation of the food grains.

 

G.                One issue which arose for the consideration of the committee is whether the system of the fair price shop holder collecting the grain directly from the Godown is compatible with the obligation imposed on the department under the PDS Control Order 2001. Clause 6(3) of the PDS control order 2001 provides that the district authority entrusted with the responsibility of implementing the public distribution system shall ensure that the stocks allocated to the fair price shops are physically delivered to them by the authorized nominee within the stipulated time. 

 

H.                The President of FPS in a meeting held in Rishikesh informed the Committee that no allotment has been made to any of the fair price shop in the city area for the month of January to March. However the Committee on inspection of the records found that as per the records quota was allotted to fair price shop owner.

I.                   One of the members from an NGO present in the public hearing in New Tehri stated that the department was not following any of the procedures prescribed under the rules properly. He cited an example where the Godown officials called a fair price shop owner to bring the money and collect his monthly allocation. (Rs. 10,000/- in the present case). The fair price shop owner was having a shop in the interior hills, which was about 5kms trekking distance. When the shop owner (Budhi Singh) reached the Godown, he found the Godown closed. After waiting for some time when he was returning back, he died. It was submitted before the Hon’ble Chairman that whatever may be the reason for his death, the department ought to have given his family members the same fair price shop/licence in order to maintain themselves. That one of the major problems in the hills was the lack of communication apart from lack of punctuality on part of the officials of the department.

 

IV.     DISBURSEMENT OF FOOD GRAINS TO THE CONSUMER

4.1     Opening of Sale: Area inspectors are duty bound to  visit the fair price shops to open the sale. Opening of sale means that whenever an FPS receives the food grain allotted to it the Area Inspector has to visit the FPS and verify that the entire quantity of food grain has been received as per allocation. He then has to sign the stock register of the FPS to certify this fact and only after the inspector has signed the stock register the FPS owner can start the sale from the allotted stock of food grain.  However, committee observed that only in the Urban Areas in the Plains  of Uttarakhand like Dehradun and Haridwar, Inspectors visit shop and sign and open sale, but in Rural areas of  Plain/ Terai Regions Inspectors don’t visit and open sale.    In the hill region even in the urban areas the area inspectors are not able to visit the fair price shop since the department is also entrusted with the duty to manage the Block Godowns. In such cases, he issues the certificate in “Form A” at the Godown. The certificate in “Form A” signifies that the allotted stock for the month has been sold by the FPS. Committee during its Visit to various shops in rural as well as Urban areas of Kumaon Region observed that Inspectors do not sign registers/ open sale regularly. In many shops Committee observed that there was no signature of concerned Supply Inspector in the Stock Registers for past  one year. Thus, the provision of opening of Sale is not followed strictly in practice.

4.2     Committee’s observations during FPS visits

 

A.      There are many statutory obligations provided by the PDS Control Order, 2001 and also by the Uttaranchal Scheduled Commodities Distribution Order, 2003 apart from the orders of the Supreme Court, which a fair price shop is expected to follow and any sort of violation of any of the obligation would result in a penal action.  However, the Committee during the visits found the following violations committed by the fair price shop:

 

                                      i.      Fair Price Shop being closed most of the days in a month.

                                    ii.      Irregular timings

                                  iii.      No Notice Board

                                  iv.      No sample kept

                                    v.      Food grains are sold to the beneficiaries at more than the prescribed rate

                                  vi.      Selling of less allocation to BPL card holders: The Committee during the visit to Rudraprayag found that the fair price shops were selling 21 Kg rice and 8 Kg wheat instead of allocated quota of 25 Kg rice and 10 Kg wheat to BPL card holders.

                                vii.      Black Marketing

                              viii.      Records are not maintained Properly

 

B.       The following two examples of fair price shops would clearly indicate gross violation of the rules and regulations and also indicate the failure of the public distribution system:

i.        During the Committee’s visit to one of the fair price shops in           Adhoiwala, Dehradun[10] 

1.     The team found that the fair price shop did not have any copy of the Weight Check Memo of any month.

2.     Stock Position:

    BPL Rice: 1.6 Quintals

    AAY Rice: 48.5 Kilos

    BPL Wheat: 4. 35 Quintals

          3.  The team on physical verification found 2.57 Q Rice in excess.

          4.  The team on physical verification found 1.60 Q Wheat in excess.

          5.  The team met one resident who informed the team that   she did not posses a ration card, however, she was buying the food grains from a FPS paying higher price.

         

 

 

6.       The Committee visited one fair price shop in Pangar Village and found the following

 

a.      Although as per the data available, the fair price shop was located at a distance of 6 km from the road end. However when the team reached the shop it found that a new road (kuccha road), which was yet to be approved by PWD, was used by the local people of the said area. In the present case, the transport subsidy for khachchar is given since the road is not yet an approved one. The distance between the said road and the fair price shop was approx 500 meters. The fair price shop owner admitted that he was bringing the food grains through this kuccha road and that khachchar was used only for the 500 meters distance.

 

b.     15 Ration cards of different categories (12 APL cards, 2 BPL cards and 1 AAY cards) were found in the fair price shop. Some of the consumers came there and gave the statement that they had voluntarily given their cards to the fair price shop since they have to travel a lot and there are chances of the cards being lost.

 

c.      The fair price shop was located in a small complex having 4 shops. The Committee found that all the four shops in the complex belong to him and his residence was at the backside of the said complex. In one shop he was running a kirana shop and in the rest he was storing the food grains. 

d.     Stock of Food grains stored were not only the ones, which he got from the FCI, but were also the ones bought from the State Godown in black. The Committee visited a fair price shop which was in the name of Shri Dinesh Uniyal located in Pangar Village, New Tehri District, where the fair price shop owner admitted that he buys food grains in black from the State Godowns to get additional income. This fact/admission shows the nexus between the officials and the fair price shop owner.

 

e.      The fair price shop owner made he following submissions:

                                                                          i.            That the State Godown Officials never weigh the food   grains           while giving the allocation to the fair price shops.

                                                                        ii.            That the department officials indulge in the black marketing of the food grains through the fair price shop.

                                                                      iii.             Since the commission is low, therefore, he is compelled to indulge in illegal activities.

                                                                      iv.            He further admitted that he is siphoning some kilos from every BPL card to ensure that he is able to sell substantial amount of food grain in the black market.

                                                                        v.            He stated that without the department’s help a fair price shop cannot indulge in black marketing.

 

4.3     Committee also met two FPS owners at Mehra Block Godown in Nainital District, who came for collecting their quota.

 

  1. Details of the First shop are :-

                                i.            FPS: Sadhan sahakari Samiti, Suyalbadi

                              ii.            Name of FPS owner  :- Mr. Laxman Singh Rotella

                            iii.            Total no. of Cards attached to shop are 300.

                            iv.            Shop is situated at the Distance of 40 Kms from the Godown.

                              v.            Samiti also do the other business like fertilizers.

                            vi.            FPS owner salary :- 5000

                          vii.            Helper Salary :- 3000

                        viii.            Price at which he is selling food grains after adding the permitted transportation cost to the Consumers is as follows:-

                  

                  

BPL (Rs/Kg)

APL(Rs/Kg)

AAY(Rs/Kg)

Wheat

5.05

7.00

2.00

Rice

6.66

8.96

3.00

                  

 

  1. Details of the second shop are :-

i.                    Name :- Sh. Bhupender singh bisht

ii.                   FPS    : - Baitalghat shop no. 810,

iii.                Details of Cards attached :-    

              AAY             APL              BPL

                             27                110              67

iv.      He is distributing 11 kg wheat to APL beneficaireis and no rice.

v.       For AAY category, 11kg Wheat and 24 kg Rice and for BPL category, 10 kg Wheat and 25 kg Rice.

vi.      Shop is situated at the distance of 37 kms from Mehara Block Godown.

vii.     He stated that he spent Rs 1500 on transportation of food grain including Sugar.

viii.     Transportation is done through truck.

ix.      He spent Rs 6 for loading and unloading.

x.       He said he is getting 1500 – 2000 Rs as income from FPS. Empty bags are additional income.

xi.      He stated that cost of 1 bag is Rs 7/8.

xii.     He is selling non PDS commodities also.

xiii.     On 25th Feb, 2009 when Committee met him in the Godown, he stated that he has come for collecting Sugar and rice for the Month of January.

xiv.     Last time he visited the Godown on 10th January to take quota of December.

xv.     He is running this FPS business for past 20 years.

xvi.     Price at which he selling food grains to the Consumers after adding the permitted transportation cost is as follows :-

 

           

 

BPL (Rs/Kg)

APL(Rs/Kg)

AAY(Rs/Kg)

Wheat

5.02

6.97

2.00

Rice

6.66

8.93

3.00

 

 

4.4       The committee visited several FPS in the three districts named Deharadun, Tehri Garwal and Uttarkashi. The findings were common. The committee observed that fair price shops are not functioning properly. Most of the Fair Price shops were found closed on visit. Several shops did not have any notice boards displayed outside their shops and were not displaying relevant information such as the entitlement of various essential commodities ,issue prices ,name of Fair Price shop owner/ licencee, timings of opening and closing, stock position, timing for inspection of citizens etc. at a conspicuous place. Some of these shops also did not display procedure for lodging complaints with reference to quality and quantity of  ration commodities and other problems faced by the TDPS beneficiaries.

 

4.5       During inspection, in the district of Uttarkashi a Fair Price shop owner was found with the ration cards of several consumers. The Committee was ensured of penal action against the Fair Price shop owner, by the Supply inspectors who were escorting the legal team during the visit. It was also discovered that some of these shops had ATTA displayed on their boards and in a few shops ATTA was found under the same premises. In a meeting held at the DSO office (Dehradun) with the FPS owners, the Committee was given various explanations for these happenings by the President of the Association of FPS owners. One of the main reasons according to him, for the black marketing of food grains by the fair price shop owners, was the low commission rates. They were left with no other option but to indulge in some other work which would be an added source of income.

 

4.6     Opening of shop, display of information: All the Shops visited by Committee in almora, and Pithoragarh district do not display the required information properly. Some even do not have display boards outside shop and most of the shops just keep a blank board  but do not display information of rate at which foodgrains is issued to various categories, and quantity to be distributed to each category and stock position.

 

4.7     FPS owner takes the food grains in his vehicle to the shop.   He makes entries in the Stock Register and start selling.    Within 1 to 3 days Circle Inspector verifies the stock in the FPS.  Circle officer would give Praman Patra in this respect in urban areas and Gram Pradhan or Patwari in the rural areas.

4.8     In Almora district during visits to various FPSs committee observed that Gram Sabha do not give any certificate for complete/ full distribution of foodgrain and FPS owners get food stock for next month without that certificate. There is no check when the food grain is distributed.  Praman Patra is given merely on checking the record/registers without actually checking the stock or inspecting the shop.  It is not surprising that FPS owner himself goes to get the signatures and Praman Patra from the Inspector /Pradhan/Patwari.

 

4.9     Inspectors do not sign the stock registers and provision of opening of sale is not followed in practice. No sample is given to FPS. Thus, sampling of foodgrain is not followed in practice.

 

4.10   Complaint of shopkeepers about delay in supply: FPS owners in Dania informed the Committee that there is no supply of food grains for the month of February.  FCI Officials informed that there is no delay on their part.  Delay is because of the fact that State Govt. does not make payment in time.  FCI issues RO in time after the payment is made by State Govt.  State Govt. Officials (DSO) accepted he fact that there is delay on their part.

 

4.11   State Government does not have enough space to store :-  Godowns are very small. Food & Supply Department themselves does not lift foodgrains in time and requests for delay in lifting.  State Govt. does not have proper arrangements for transportation of foodgrains to their godowns.

 

4.12   DSO, Uttarkhashi informed the committee that once the advance allocation reaches state godown in these areas, the department officials present distributes the entire advance allocation to the fair price shops who in turn distribute it to the consumers. When the committee asked as to how the department ensured that the fair price shops dealer had properly distributed it. The DSO in reply stated that the only way to confirm the proper distribution was the report of the sarpanch. He further added that normally in such extreme season the fair price shop would not think of diverting the food grains as the whole village depends on the PDS ration.

 

4.13   The Committee enquired from the district office whether all the cards in the inaccessible areas were BPL, since APL has negligible allocation in the State. It was informed by the DSO, Uttarkashi that there were APL cards in inaccessible areas and that in order to ensure that they get full quota of the ration the District Magistrate requests the godowns to make adjustments to ensure that APL in inaccessible areas are also given full quota. It was also informed that when additional quota is released the same is utilized for this purpose as well.

 

 

 

 

 

 

 

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CHAPTER 5

TRANSPORTATION

1.1             Total numbers of State godowns (both Base and internal Godowns) in Uttarakhand is 173. Out of which 83 are State owned godowns and rest 90 are hired godowns.

 

1.2             The food grains are transported from the FCI godowns to ‘Base godowns’ and from there the same are transported to ‘block Godowns’.  The cost of Transportation of foodgrains from FCI to base godowns and from Base godowns to block/internal godowns is borne by State Government and transportation is done by the transporters who are appointed by tender process. From block godowns to the FPS transportation is done by the FPS himself.  .

 

1.3             In Plain Regions

Marketing Wing looks into the Transportation of food grains, thus  in Plain areas the contract is usually between Regional Food Controler (RFC) and transporter.

 

1.4     In Hilly regions 

          Supply Wing looks into the transportation from ‘Base godown’ to     ‘Internal godown’. District Magistrate is responsible for the over all           distribution of Food grains in a District. However, usually it is only       DSO who looks into transportation in Hilly areas. Thus the    Transportation Contract is between District Magistrate/ DSO and     Transporter. Transport contractors appointed by the District           Magistrate/DSO collects food grains from the base godowns   and   transport them to the internal Godowns. 

 

1.5     FCI Godowns to State Base Godowns: Regional Food Controller who is head of Marketing Wing engages trucks for transporting the food          grains from FCI Godown to base Godown (State godowns) and enters         into contract with transporters by issuing tenders every year for transportation of PDS food grains.

 

1.6     During the visit to the State ‘Base Godown’ in Jwalapur, Haridwar, the Committee met a transporter where the Committee found that transporters get Rs 6.85 per quintal for transportation of food grain.

 

1.7     Base Godown to  Block (Internal) Godown: The State Government is responsible for the transportation of the food grains from the State          (Base) Godown to State (Internal) Godown. The cost of the transportation is paid by the State Government and that the transportation is done by the transporters who are appointed by tender process.  The contract is entered between RFC  and transporter. In hilly region the State Government uses the following modes of transport to move the food grains to the internal godowns:

a.                  Truck

b.                 Mules (khachchar)

c.                  Coolie

 

 

 

1.8     However, in some inaccessible areas like Burfu, Gunji, Dugtu in Munsiari and Dharchula sub-division of District Pithoragarh in Kumaon Region transportation from base Godown to Internal block Godowns in those areas is done by sheep and mules only. The Contract for           Transportation is made between Governor of Uttarakhand through District  Magistrate / DSO and transporter. As per the terms and Conditions of Transportation Contract, Transport Contractor, who transports Food grains to head load Godown, (Paidal godown) viz, godown located on pedestrian route, shall have to deliver the   dispatched Commodity to concerned head load godown within Thirty days from the date of dispatch,  failing which a fine of Re 1 per           quintal per day shall be imposed against the concerned transporter for delay.

 

1.9     The District Supply Officer, Uttarkashi informed the Committee that the transportation of the food grains in the inaccessible areas is really difficult during the monsoon and winter season. He further stated that every effort is made to ensure that the food grains reach before          the season sets in, as once there is rainfall or snow then it is difficult for the khachchar or the laborers to transport the food grain.  The Committee was informed that the State was bearing the       transportation cost in respect of the movement of the food grains to the State Godown and that Central Government was not giving any subsidy to the State. He further stated that even the tender rates are substantially higher in inaccessible hill region.  The following table would indicate the tender rates details in Uttarkashi District. The    following points would help to understand the table in a better manner.

 

·                 The normal rates as mentioned in the second column of the aforesaid table means the rates which would be applicable during the normal season.

·                 If the monsoon or winter season sets in and the transportation has to be done during that time, then the transporters would get abnormal rate mentioned in the third column. The abnormal rate is given since, it very difficult to transport the food grains once the season sets in. The committee was informed that the abnormal rates are paid in cases where there is a delay in sending advance allocation.

·                 The bids which were made in respect of the aforesaid Paidal Godowns were much higher and the department has to negotiate to bring it down. The fourth column has the actual bid.

 

Godown

in Uttarkashi District

Normal Rate (per quintal) at which tender is granted

Abnormal rate (per quintal) at which tender is granted

Actual Bid before the Negotiated Rate was fixed

Jhakol

201.89

476.77

210.09

Taluka

366.19

475.84

380.09

 

 

1.10   State Internal Godown to Fair Price Shop: From the Internal Godowns to the Fair price shops, food grains are transported as per the available transport facilities with the FPS owner. The fair price shop owner arranges transport for transporting the food grains from the Block Godown to the fair price shop.  In plain areas usually truck or tempo’s are used by FPS to transport food grains from state godown          to FPS. In hilly region there are three modes of transport used by the fair price shop owner for the movement of the food grains which are    as follows:

a.   Truck

b.  Mules (khachchar )

c.   Coolie

 

1.11        The Committee was informed that the District Magistrate of the concerned district passes an order in which he specifies the rate of transport per kilometer and also per quintal in respect of various modes of transport used in the hilly region. The fair price shop is accordingly allowed to add the calculated rate of transport to the selling price of the food grains. Though rates are fixed for the transportation, which is fixed by District Magistrate, but there is no check as to how much FPS owners charges from consumers.

 

1.12        The Committee was informed by the DSO, Uttarkhashi that a representation was given by the fair price shops dealers of the district requesting the District Magistrate to fix new rates for the transportation since the present rates were fixed way back in 2001. The DSO stated that the District Magistrate would be fixing new rates of transportation in next few months keeping in mind the increase of the transportation cost. However, he stated that there is no yearly review of transportation rates.

 

1.13        In Bhadarbhad Godown at Haridwar Transporter informed the Committee that  the actual charges which he spent from his pocket for transportation of 150 Q of foograins was Rs 2400, approved tender price for the same quantity of foodgrain was Rs 1600 which he gets from the State. This gives inference of   diversion by transporters.

 

1.14        Committee was informed in Almora that Transportation Rates were revised on 1.5.2007 after 10 years.  For first   5 Km. it is Rs.12/- per Km. per quintal.  For every additional 1 Km it is Rs. 0.70 per quintal.  These rates are for the FPSs situated on motor able roads.  Transportation by Khachhar (mule) it is Rs. 6 per Km. per quintal.  For Paidal (head load) it is    Rs.3/- per Km. per quintal.  These rates are fixed by the District Magistrate after collection of relevant data.  No tender is invited. For transportation from Base godown to FPS, tenders are invited.  Contract is given for one year.  Last contract was given in June 2008. After tenders are received, a committee is constituted for fixing the rates.

 

1.15        Officials of Nainital district informed the Committee that transportation rates incurred by the FPS owner for transporting food grain from Block Godown to their Shops are fixed by the District Magistrates of the Concerned District. The transportation rates for FPS owners in the Nainital District are Rs 1 per Quintal/Km for Vehicle and Rs 8 per Quintal/Km for head Load.

 

1.16        In the case of Plain Areas, no transportation cost is paid to the FPS owner. But in the case of the Hilly Areas, FPS owner is allowed to add the transportation cost for transporting food grain of BPL and APL category and recovered from beneficiaries, and for AAY category, he got reimbursement from State Government

 

1.17        For the reimbursement of transportation cost incurred on transporting AAY Foodgrain, FPS owner have to submit the transportation bill to the concerned DSO after verification from the incharge of the Godown with whom he is attached.   The Distance between the Godown and FPS is verified by the Patwari of the area. But in reality, they don’t get any reimbursement for the same as there bill is pending for last 4-5 years.

 

1.18        DSO Pithoragarh informed that there are three FPS in Burfu. FPS owners get Rs. 6/- per quintal per KM in Dharchula and Munsiary and in other areas transportation is Rs. 5/- per quintal per KM.  The transportation cost is ultimately borne by consumer.  

 

1.19        Observations/Inference

 

i)                   A proper vigil has to be kept on transportation of the PDS food grains from the Godowns of FCI to the Fair Price Shops. GPS system can be used for tracking the movement of Trucks carrying food grains. For this, routes that have to be followed by Trucks carrying food grains have to be specified. Devices required for GPS should be installed on every such Truck and movement of the Truck should be monitored. Attachment of device of GPS in the Trucks engaged in Public Distribution System may be made part of the tender conditions.

 

 

 

ii)                 There should be “Zero tolerance” in cases of breach of contract committed by Transporters. Deterrent monetary penalty should be imposed against the errant Transporters. In the event of even a single breach resulting in diversion of food grains not only should the Bank Guarantee be forfeited but also the Transporters should be blacklisted for a specified number of years along with monetary penalty. Apart from the errant Transport Contractor, immediate stringent/deterrent action should be taken against officials working in the Department, in cases where a prima facie case of their involvement in an incident of diversion is made out.

 

iii)               It is relevant to point out here that the Planning Commission provides funds under its plan programmes for strengthening the operational machinery of Public Distribution System.[11] The funds are, inter - alia, provided for schemes for purchasing mobile vans/Trucks for distributing essential commodities, where static/regular Fair Price Shops are not found viable/feasible.  This facility of mobile Fair Price Shop, the Committee feels, can be availed of for providing food grains in areas where the number of food cards/ration cards does not justify opening of a Fair Price Shop as per the norms. 

 

 

********

CHAPTER 6

VIGILANCE MECHANISM, OMBUDSMAN AND ENFORCEMENT

I.       VIGILANCE MECHANISM

1.1              Vigilance committees though constituted in the state at various levels are not functioning and are defunct. Vigilance Committees were formed as per the government orders, however, no meetings have ever been held nor were any minutes recorded ever. During the visit to Uttarkashi the Committee was informed by one former District Magistrate that normally the vigilance committees at the district level do not sit independently and that all PDS issues are discussed in various meetings with ministers and district officers from time to time.  However he could not provide any minutes of the meeting[12].  

 

1.2              So far as inspection of FPS by the Inspectors is concerned as the strength of the inspectors is less (as per the officials whom the Committee met during its different visits) and they have to manage both godowns and field, therefore the villages in the higher hill terrain are never inspected and department does not have any records regarding distribution of food grains in those villages.

 

1.3              On enquiry about the affairs of vigilance committees, the outgoing District Magistrate (Tehri) informed the Committee that a strict vigilance is kept on the functioning of PDS in the rural areas. He further stated that since the members of the vigilance committee consists of consumer activists and members of parliament, they are held up due to their other commitments, and therefore, the vigilance committees could not play a proper role to ensure the smooth functioning of PDS. A fair price shop which was very close to the office of DSO in Uttarkashi District was last inspected in the year 2005.

 

II.                ENFORCEMENT

 

2.1     The enforcement of the functioning of the Public Distribution system in the State is almost non existent. The State Government was requested to furnish details of the prosecutions and departmental action taken during the last five years but no details of prosecutions were provided to the Committee. The State Government provided the figures for the departmental actions taken during the last five years and the number of FIR’s registered which are as under

 

Year

Raids/

Inspections

FIR’s Registered

Licences suspended

Licences Cancelled

Amount Confiscated

2003-2004

8552

01

48

57

 88500.00

2004-2005

8121

15

96

52

122300.00

2005-2006

9878

14

108

51

175520.00

2006-2007

11728

09

149

65

331013.00

2007-2008

8079

08

84

54

220945.00

Total

46358

47

485

279

938278.00

 

 

2.2     No system can be implemented properly unless there is a proper     system of enforcement of the rules and regulations. These figures       do not show if any action was taken against defaulting officials.

 

2.3     An effective system of enforcement of the punitive and penal provisions of the Act and the control orders has to be set up by each state to ensure compliance with their provisions.

 

2.4     Section 7 of the Essential Commodities Act, 1955 provides penalties for the person contravening any orders made under Section 3 of the same statute.

         

2.5     The control orders provide rules for compliance by the wholesale distributors, retailers and also for entitlement of a ration card holder         under various categories. These rules have to be enforced by the          state through an independent and effective enforcement mechanism.

 

2.6     The Committee recommends that there should be Zero Tolerance as far as the infraction of the provisions of law relating to Public Distribution System is concerned. It would be relevant to state that the Hon’ble Supreme court in its Order dated 2nd May 2003 issued the          following directions to facilitate the supply of food grains-licencees, who

·                       Do not keep their shops open throughout the month during the stipulated time,

·                       fail to provide grain to BPL families strictly at BPL rates,

·                       to keep the cards of BPL house holds with them,

·                       make false entries in the BPL cards,

·                       engage in black marketing or siphoning away of grains to the open market and hand over such ration shops to such other person/organizations

·                       Shall make themselves liable for cancellation of their licences. The concerned authorities /functionaries would not show any laxity on the subject.      

 

2.7     These directions have to be enforced by the state governments and machinery has to be set up in each state for such Enforcement.  The    hilly and difficult terrain in the state coupled with the shortage of staff      was pleaded as an excuse. This is totally unacceptable. The officials of       the Food and Supplies Department admitted before the Committee[13]     that although there were rules for the formation of enforcement wing   yet none did exist presently.

 

2.8     It is necessary that special squads be set up by the stateGovernment         in every district for enforcement of provisions of The Essential       commodities Act and the Control Orders and ensure the compliance       by the Licencee.

 

2.9     The committee found that there were few cases registered under the essential commodities act and the outcome of these cases was not given to the Committee presumably because majority of such cases result in acquittals. There is also undue delay in the decision of such cases. The punitive action taken by the state was found to be ineffective and in adequate. The malpractices in the PDS continue because of the lack of effective enforcement system.    

 

2.10   To keep a check on the implementation of the TPDS proper enforcement is necessary. No particulars of the action taken and          result thereof have been indicated by the State Government. The           State urgently needs an active and vigilant enforcement wing to      ensure the proper functioning of the TPDS.

 

2.11   Enforcement- DM is too busy and does not supervise well. DSO is the only functioning authority and DM is not looking after enforcement. DSO Pithoragarh informed that he has done inspection of 8 godowns         during his tenure viz Berinag, Thal,  Bungacheena, kanalicheena,     munakot, pithoragarh Gangolighat and Incholi. He informed that he     had not inspected godowns in inaccessible areas.

 

2.12   DSO Nainital informed the Committee that Enforcement Squad is formed in the Nainital District and it has also conducted raids. He told the last raid was conducted in January 2009. During the raid, 48 shops were inspected, out of 48 shops, licences of two FPS shops were suspended and Rs 18000/- was recovered by way of penalty from other shops for irregularities like non display of  required  information outside their shops.

 

III.    OMBUDSMAN/ REGULATOR

3.1             The Ration Card Holders have been given certain entitlements under Public Distribution System.  It is the responsibility of the state apparatus to ensure that these beneficiaries enjoy access to these entitlements smoothly, without let or hindrance. Public satisfaction in this field would strengthen the democratic system and reinforce public confidence. Widespread discontentment will naturally provoke disruption and affect social stability adversely. Hence, it is imperative to take urgent action for suitably strengthening the vigilance and monitoring system in the existing Public Distribution System framework. This can be done by the appointment of an independent Ombudsman/Regulator.

 

3.2             While the Central Vigilance Committee is of the view that an independent monitoring mechanism for addressing consumer complaints along with a host of other related issues needs to be set up on priority. Such grievance redressal machinery would be in addition to the already existing legal remedies that may be available to an aggrieved person under Clause 11 of the Public Distribution System (Control) Order, 2001. This alternative mechanism may be in the form of “Ombudsman/ Regulator” that may be created under Para 6(1) of the Annexe to Clause 8 of the Public Distribution System (Control) Order, 2001. Para 6(1) of the Annexe to Clause 8 of the Public Distribution System (Control) Order, 2001 casts an obligation upon the State Government to provide a proper system of monitoring FPS. This clause provides the statutory basis for setting up an independent monitoring mechanism such as an “Ombudsman/ Regulator”.

 

3.3             The objective of Ombudsman/ Regulator would be that he would act as ‘Watch Dog’ to ensure effective compliance of the PDS Control Order, 2001’. The Ombudsman/ Regulator will also provide free, fair, independent mechanism for speedy resolution of complaints with reference to the benchmark set out in the governing statute, order and circulars by the authorities. Ombudsman/ Regulator should focus on investigating and resolving individual complaints. The Ombudsman/ Regulator should provide the consumers an easily accessible system, which would be just and speedy in redressal of their complaints and grievances. This should not become a procedure bound system or be driven by dilatory reports. Investigation will be resorted to wherever considered necessary by the Ombudsman/ Regulator. The Ombudsman/Regulator shall oversee the functioning of the Enforcement Branch including the Anti Hoarding Cell.   

 

3.4             Ombudsman/ Regulator should be appointed by the Governor of Uttarkhand in concurrence with the Chief Justice of The High Court. He or she will not be eligible for re-appointment.

 

3.5             Eligibility Conditions

A.      The Ombudsman/Regulator should be a sitting/retired member of the Uttarakhand Higher Judicial Services who is or has been in the super time scale.

B.       If the Ombudsman/Regulator is a retired member of the Uttarakhand Higher Judicial Services, he/she will remain in office for a term of three years or upon reaching the age of Sixty five, whichever is earlier. 

3.6             Terms and conditions of service: The salary and allowances payable to the Ombudsman/ Regulator shall be the same as payable to a member of the Uttarakhand Higher Judicial Service in the super time scale.

3.7     Removal and Resignation from office: Whereas a sitting member of the Uttarakhand Higher Judicial Services will be governed by the service rules applicable to him. In the case of a retired member of the Uttarakhand Higher Judicial Services being appointed, the following will apply: -

A.                The Ombudsman/ Regulator may be removed from office by the Government at any time after his appointment if he has:

(i)          Been adjudged an insolvent; or

(ii)        Been convicted of an offence involving moral turpitude; or

(iii)      Become physically or mentally incapable of acting as Ombudsman/ Regulator; or

(iv)      Acquired such interest as is likely to prejudicially affect his functions as Ombudsman/ Regulator; or

(v)        So abused his position as to render his or her continuance in office prejudicial to the public interest.

B.                 However, the removal on the grounds specified in clauses (iv) and (v) can be done only in concurrence with the Chief Justice of the High Court, after following the principles of natural justice.

 

3.8     Functions and Responsibilities of Ombudsman/ Regulator

A.      Ombudsman/ Regulator would be that he/she would act as ‘Watch Dog’ to ensure effective compliance of the PDS Control Order, 2001, The Uttaranchal Scheduled Commodities Distribution Order, 2003 and applicable instructions. The Ombudsman/Regulator will constantly monitor each facet of the distribution process detailed in the governing control orders and circulars to ensure inter alia that the correct quantities of SFAs reach the intended beneficiaries.

B.       In addition the Ombudsman/ Regulator will deal with Consumers’ complaints and grievances which may broadly be classified into two groups:

Ø                  Basic

Ø                  Complex. 

C.       Basic complaints would mainly relate to non-provision of Public Distribution System items benchmarked to quality/quantity, delays, harassment etc. Complex complaints would relate to matters involving laws, enforcement deficiencies and widespread discontent. Basic complaints may require summary disposal without undertaking any detailed investigation. Complex complaints may involve proper investigation.

3.9     Having regard to the class of complaints, whether basic or complex, the functions and responsibilities of the Ombudsman/ Regulator will be as follows:

(i).     To act as the repository of complaints/grievances received upon the Helpline. Ombudsman/ Regulator shall also monitor the functioning of GPS technology that may be used in the Transportation of Food grains and deal with all matters relating to consumer complaints arising from deficiencies in various stages of Public Distribution System operation;

(ii).    To act as the monitoring authority in respect of functioning of the Vigilance Committees and follow up action taken by the Department on the reports/recommendations of the Vigilance Committees.

 (iii).    To investigate, where necessary in the judgment of the Ombudsman/ Regulator, complaints on case-by-case basis after seeking the perspectives of parties involved and making an independent assessment of complaints;

(iv).    To seek resolution of complaints through application of extant law, rules and orders in complex cases based on his or her personal assessment of what is reasonable and fair;

(iv).    The Ombudsman/ Regulator will have jurisdiction to address and investigate, where necessary, complaints about, inter-alia, the following matters:

1.     non-observance of the PDS Control Order by  FPS  owner.

2.     short supply of Food grains/sugar/kerosene oil below entitlement;

3.     supply of poor quality Food grains not matching the sample on display; and

4.     diversion of Food grains to shops other than FPS.

5.     the manner in which complaints received from the consumers/complainants including those on the toll free Helpline, have been dealt with by the concerned officials of the Department.

6.     Action taken by officials of the Department on reports of Vigilance Committees.

(v)     It will be the responsibility of Ombudsman/ Regulator to devise and implement communication strategy to educate consumers as well as FPS owners about their rights and entitlements as well as various dos and don’ts of  Public Distribution System.

(vi)   It is made clear that the remedy to approach the Ombudsman/ Regulator would be in addition to and not in derogation of other remedies available in law.

 

 

3.10   Powers of Ombudsman/ Regulator

The powers of the Ombudsman/ Regulator, inter-alia, would include:

A.                Public functionaries in the Department of Food and Civil Supplies of Uttrakhand/Food Corporation of India, in charge of, or dealing with  Public Distribution System, must function with “due diligence”; that is, they must ensure that within the framework of the system, the consumers’ entitlements of Food grains etc., are made available to them on time through the distribution network.  Any deficiency or shortcoming on their part, with reference to the benchmarks, will render the functionary personally liable to action. The Ombudsman/Regulator will have the power to recommend and monitor departmental action in respect of errant officers keeping in mind the governing disciplinary rules.   In cases of violation of any laws in the matter of Public Distribution System, the Ombudsman/ Regulator can direct the concerned authorities to take action against the person/party. There cannot be any corruption in Public Distribution System unless there is complicity between FPSs, Department Officials and the Transporter. While the FPS owner and the Transporter can be prosecuted under Section 7 of the Essential Commodities Act, 1955 for violation of the provisions of law including the Public Distribution System (Control) Order, 2001, it is incongruous that the Department officials who are fully involved in the crime should be proceeded against only departmentally in the absence of sanction under Section 15A of the Essential Commodities Act, 1955. The Committee therefore recommends that Section 15A be suitably amended by deleting clause (b), which deals with public servants belonging to the State Governments. The Committee also recommends that till the legislature makes such an amendment as proposed, the State Government shall delegate the power of sanction for prosecution to the Ombudsman/Regulator. 

 

B.                 The Ombudsman/ Regulator can recommend payment of compensation to a complainant upto a maximum amount of Rs. 5,000/-, and/or supply of goods and services as required for resolving the complaint or/and issue cease and desist order. In case of complaints of a frivolous nature, the complainant will also be liable for similar action.   The amount mentioned above would be paid by the Department to the beneficiary at the first instance and would be recovered from the concerned officer.

 

C.                 The complaints received by the Ombudsman/ Regulator may be referred by him for a report from the District Vigilance Committee or FPS Vigilance Committee, as the case may be. It is clarified that this power of the Ombudsman/ Regulator to make a reference shall be in addition to and not in derogation of the powers of the Ombudsman/ Regulator to conduct an independent enquiry into complaints. While, the reports so received, will assist the Ombudsman/ Regulator in providing solution, these reports will not be binding upon the Ombudsman/ Regulator.

 

D.                The Ombudsman/ Regulator also may not entertain a complaint if the complaint is more than  90 days old which can, however, be relaxed by Ombudsman/ Regulator in his discretion in deserving cases and final  resolution of complaints will need to be prescribed for ensuring speedy and efficacious handling of complaints.

 

E.                 Time limits for addressing complaints, various stages involved in completion of investigation and final resolution of complaints will need to be prescribed by the Ombudsman/ Regulator for ensuring speedy and efficacious handling of complaints.

 

F.                  The Ombudsman/ Regulator will ensure that all codes/orders/regulations etc., are put on the website for the convenience of the consumers.

 

G.                The Ombudsman/ Regulator will have authority to suggest/recommend changes in operational matters to smoothen and simplify the operation of the system.

3.11        Structure

The Ombudsman/ Regulator would need to be given a nucleus of staff to examine issues from both reactive and pro-active approaches.

3.12   Funding

It will be the responsibility of the Government to provide funds for implementation of the foregoing recommendations including meeting administrative and operational expenses of the office of Ombudsman/ Regulator including the staff thereof. In this context it is relevant to point out that the Planning Commission provides funds under its plan programmes for monitoring and improvement in the management of supplies.

 

3.13    If the State is unable to setup an Ombudsman as suggested then his tasks may be assigned to the District Judge or to an Additional District Judge in the district concerned.

    

*******

CHAPTER 7

IDENTIFICATION OF BENEFICIARIES

 

1.1              The Committee discussed in detail the problem of identification of BPL and the aspects relating to exclusion and inclusion errors in the report relating to the state of Orissa. The inferences in that chapter may be read as part and parcel of this chapter as well.

 

1.2              In Uttarakhand a family whose annual income is less than Rs. 9,000/- per annum is entitled to have a BPL card. The Committee was informed that as per the government orders there were two systems of issuing rations cards. In Urban Areas as per the provisions of Uttranchal Scheduled Commodities Distribution Order, 2003 (hereinafter refereed to as the “Order 2003”) the  Supply Inspector conducts inspection and verification for issuing ration cards, however it is the District Supply Officer who issues the ration cards after considering the report of the supply inspector. In case of rural areas it was the Naib Tehsildar and Tehsildar, who look after the issuance of rations cards. However, it was clarified by the District Supply officer that irrespective of wherever the cards were made, the entire data was submitted in the main district office in Dehradun on regular basis.  In the inaccessible villages in the hilly region the committee found that there are many card holders of BPL category who fall in the APL category. This raises the issue as to whether “location vulnerability” should be the criteria for identification of BPL cards.

 

1.3              The issuance of BPL cards of late has been purely under political pressure. Many immigrants from across the state and international borders have settled in the State. As per the department officials the sole purpose of this pressure on the department by the politicians is to create their vote bank. The political interference is so high that in some cases the inspectors are pressurised not to do the verification properly. 

 

1.4              It was further stated by the department officials that they could not   object to this pressure as, they would get threats of transfer or even of termination. Although as per the law, a ration card can not be used as a proof of identity or certificate of income but, all the schemes which are floated by the government receive ration card as a proof, therefore families prefer a BPL card only to ensure that they get adequate free facilities under the other government schemes. 

 

1.5              There was no uniform guideline or conditions to identify BPL. This is also the reason for issuance of excess BPL rations cards to some extent. Since the supply of the food grains in BPL and AAY categories was full therefore, people want to be in these categories. When the officials were asked by the Committee whether all the APL card holders wanted food grains from PDS, it was stated that mainly the upper lower and lower middle class would prefer it. At this point it was suggested by the department officials that the income condition of below Rs. 9000/- per annum should be increased to such an amount, which would at least cover middle-middle class of the society. They further stated that the rest should not be given any ration card at all.

 

1.6              For urban areas the Committee maintains its view stated in the Delhi report that APL category should be removed and the income criteria for BPL cards should be the earning of the person on the basis of the minimum wages fixed for an unskilled worker. The committee was informed that the Minimum wage for unskilled worker has been revised to Rs 100 per day.

 

1.7              As far as rural areas are concerned expert group set up by MoRD is reviewing the criteria for 2008 BPL census.

 

1.8              Another most important problem that the Committee identified in issuance of ration cards is the exclusion and inclusion errors.  The problem is very much similar to the problems that exist in Delhi and other states. The following instance would indicate the inclusion and exclusion errors. During the distribution of the handbills the Committee met a family, which was living in a small hut. The team observed that apart from bare utensils and some basic things like clothes etc, the family was considerably in a poor condition. There was no electricity connection and that the hut had no door as well. The family consisted of an ailing husband and a working wife. The wife was working as a domestic servant having a salary of Rs. 300/- per month. The family informed the team that they had been issued an APL ration card.  The team studied the ration card issued to the family and it was observed that the declared income of the family was shown as Rs. 18000 per annum as against the earning of Rs. 3600 per annum which the family claims to earn. [APL Ration Card No: 136093; Name of the card holder: Shrawan kumar[14]].

 

1.9              During the Committee’s visit to one of the villages around Dehradun, the Committee was informed by one of the resident that in order to get a BPL ration card one had to pay Rs. 500/- as bribe to the Secretary Gram Panchayat.[15] On inspecting the files of the new BPL[16] ration cards the team found one ration card holder who earlier had an APL card. However he wrote an application to the inspector whereby he stated that he had only two daughters and a wife and his income had substantially reduced, therefore he requested that his card should be converted into a BPL card. The inspector informed the team that he had personally verified the present case and only after full satisfaction he had converted the card. The team visited the residence of the cardholder Anand Ram and found the following:

a)              Card shows that they have 2 daughters whereas in reality they also had one son who has separate ration card.

b)              Two separate cards on the same address.

c)               Declared income shown as 600 per month whereas the wife of Anand Ram alone earns 2000 per month as she is working in Goshala.

d)              Inspector admitted that his clerk did the verification.     

e)              The son Ramesh Singh also had another ration card in APL category. 

f)                Family owned a cow as well.

 

1.10        During the course of the public hearing, it was informed by the department that one of the main reasons for the distribution of lesser quota to the BPL cardholders in hill region was the excess issue of BPL ration cards at the block level. The identification of categories and issue of ration cards is done by Rural Development Office. The team was further informed that although there were instructions from the department to cancel the excess cards, the same could not be done as identification was not possible.

 

1.11        In order to find the above reason as to why the identification of the excessive ration cards is not possible the team visited the BDO office at Augustya Muni in Rudraprayag. There are 156 gram sabhas and equal number of gram panchayats. The block is oldest and biggest in the Rudraprayag District. There are 2212 AAY cards, 5073 BPL cards and approx 27776 APL cards.  There are 16 posts of Gram Vikas Adhikari. The BDO further informed the Committee  that the block office was presently handling various schemes and programmes for the benefit of the poor people.

 

1.12        The Following things were observed by the Committee in respect of the   issue of the ration cards:-

 

                    i.                        The Committee was informed that the ration cards were Issued only till Dec 2007 and no new ration cards have been issued since then.

                  ii.                        No yearly review was conducted by DFSO. It is all dependent on BDO of the area whether he does it or not.

                iii.                        DFO can only request them to conduct the survey. He cannot order them as it is the duty of DFSO and not the BDO.

                iv.                        Identification and survey for cards was not the main work of BDO. It is the extra work imposed on him. If he gets the extra      time, only then he does this otherwise he does not do the work.

                  v.                        The Card Holders who should be transferred from BPL to AAY        have still not transferred. Because of this, BPL allocation becomes less and AAY allocation is wasted in the Godown.

                vi.                        The Committee visited the office of the Gram Vikas Adhikari of Augustya Muni area and observed the following:

 

A.          The team was informed that there were 10 gram sabhas and 20 villages under the office.

 

B.           Ration Card Application File: No signatures in any of the files except for initials and that too without any proper stamp. It was further observed that there were no applications for issuance of BPL cards  Under the rules certain documents are to be provided by the applicant along with the Application Form. It was observed that though the documents have been marked as provided but the same were not annexed along with the forms. For example in an Application by an applicant named Surni Devi w/o Shri Mann Singh, following documents were marked as provided but were not annexed.

1.                    Tenancy slip

2.                    Surrender Certificate

3.                    Unit wise certificate

4.                    FPS allotted: Bhuwan Chand Dogrial

 

1.13        District Magistrate of Tehri informed the Committee that the identification of BPL and AAY families in rural areas is done by the Panchayats, she also stated that the inspectors of the food and supply department do not visit the areas. District Magistrate Tehri further informed that the annual verification of BPL AAY cards has not been done.

 

1.14        Committee was informed that the minimum wages for an unskilled worker is Rs 100 per day in the State of Uttrakhand.  Public interaction revealed that even people are of the view that that the identification should be on the basis of minimum daily wage i.e the identification of BPL should be on the basis of Annual income as per the minimum daily wage which is Rs 36,500 (Rs 100 x 365 days) per annum and not the existing norm i.e Rs 9000/- per annum. The income criteria for all BPL cards should be earning of a person on the basis of minimum wages fixed for an unskilled worker. Even the income criteria used as one of the indicator by MoRD in 1997 BPL census was Rs 20,000/- per annum and that fixed by Planning Commission is also Rs.22400/-.

 

1.15        It is suggested that the present income criteria for identification of the people eligible for subsidized food / TPDS which are presently called BPL should be raised

 

1.16        The Hon’ble Supreme court in its order dated 14.02.2006 has held that the survey methodology for the next BPL census will be designed by the ministry of rural development in consultation with the Supreme Court Commissioner in the Right to Food Matter Case being W.P. (C) No. 196/2001 along with other sections of the society . Latest by the beginning of the eleventh five year plan . Provisions will be made for the new names to be added and ineligible names deleted from the BPL List 2002 on a continuous basis during the period that the list will be applicable.

 

1.17        Study of following figures taken from the food bulletin published by Ministry of Food, civil supply and consumer affairs reveals that the percentage offtake of the foodgrains in APL quota is very low.

 

Wheat

Percentage offtake in State of Uttarkhand

Year

APL

BPL

2000-2001

0

0

2001-2002

0

0

2002-2003

2.052

55.870

2003-2004

8.175

85.613

2004-2005

4.796

100.189

2005-2006

24.293

106.406

2006-2007

81.628

102.068

2007-2008

98.219

102.168

April 2008

48.914

100.742

 

Rice[17]

Percentage offtake in State of Uttarkhand

Year

APL

BPL

2000-2001

0

0

2001-2002

0

0

2002-2003

0.022

61.470

2003-2004

1.155

82.662

2004-2005

5.488

101.283

2005-2006

9.931

100.311

2006-2007

19.099

84.102

2007-2008

51.084

88.005

April 2008

36.521

88.724

 

1.18        Thus, it opens the ways and provides the opportunities to divert the food grains issued for APL. The present Public Distribution System is targeted to the poor section of our society, the above figures support the view that APL cards can be abolished to cut down the opportunity of diverting food grains so that subsidized food grain only reaches the targeted people.

 

1.19        Identification of beneficiaries :- People who earn less than 9000 per year are BPL. But during interaction with  beneficiaries Committee found that the identification is not done properly. In village Dania during the interaction with local people of village committee was informed that many people who are in government job are given BPL cards. Identification error was common grievance of various beneficiaries who complained that people who are not poor are given BPL cards and many poor families who deserve BPL card are left out and they buy from open market. Thus committee found that identification of beneficiaries is not done properly. At the Block level, BDO has the power to cancel/ make new ration cards.

 

1.20        Diversion of APL foodgrain:  There is no fix number of APL families.  As there is no limit  and any number of cards can be issued.  APL beneficiaries are issued food grains  on first-cum first basis and usually they get 1 -2 Kg of food grains  which is not only arbitrary but also gives opportunity for diverting the food grains.

 

1.21        The PDS Control Order 2001 provides that the State Governments shall formulate guidelines for the purposes of identification of families living Below Poverty Line (BPL) including the Antyodaya families as per the estimates adopted by the Central Government.  Care will be taken to ensure that the families so far identified are really the poor.  Exercise of identification of BPL and Antyodaya families, wherever it has not been done already   to be completed within three months of the issue of the PDS Control Order, 2001.

 

1.22        The Control Order 2001 provides that the State Government shall ensure that no eligible applicants is deprived of a ration card under the PDS.  Apparently, due to the absence of proper criteria and the absence of review large number of people entitled to the benefits under the PDS have been denied such benefits.

 

1.23        It further provides that the State Government shall conduct periodical checking of ration card to weed out ineligible and bogus units in ration card.  Ration card shall be valid for a period of five years from the date of its issue unless it is suspended or cancelled earlier.  A ration card shall be issued afresh or reviewed after fresh verification of and such other checking as may be prescribed by the State Government in this regard.

 

1.24        No such exercise has been undertaken by the State Government.  There is no checking for weeding out of ineligible or bogus ration cards or bogus units in ration cards has been undertaken by the state.

 

1.25        The Control Order 2001 also provides that elimination of bogus ration cards as well as bogus units of ration cards shall be a continuous exercise by the State Government to check diversion of essential commodities.  This exercise has never been undertaken and hence there is a complete failure on the part of the Government to reach at a correct estimation of BPL families in the State.

 

1.26        High exclusion error means a low coverage of BPL households. Large inclusion errors imply that the APL households receive an unacceptably large portion of subsidized grain.

 

 

 

 

*********
CHAPTER 8

COMPUTERISATION

 

1.1             It has been observed that the computerisation in the entire State is almost negligible. Unlike other states the State has not even made an attempt to plan a computerised mechanism which would ensure effective distribution under the public distribution system.  The issues relating to computerization and suggestions in this respect are being discussed in a separate report of this Committee on “computerization of Public Distributions System” already submitted in the Supreme Court and the same should be read as part and parcel of the present chapter. In this chapter the observations of the Committee during its visit has been discussed. 

 

1.2             Some computers were installed in District Offices and Base Godowns are merely for the sake of entry of data/records and in most of the places the computer installed was not even working. However as will be elaborated later computers were in fact installed internal block godowns but were recalled on account of the fact there was no electricity or connectivity in the said godowns. 

 

1.3             The State is under the process of giving computer codes to all the fair price shops in the State and intends to store all the basic data in respect of the fair price shop on the computer. However the said exercise is merely an uploading of data and nothing related to an automated system which the committee has suggested.

 

1.4             In plain words there are two essential requirements for success of the computerisation. They are a) Electricity Supply and b) Connectivity. During the journey to the Uttarkashi District from Dehradun, the Committee observed that there were many hilly regions where there was no connectivity at all. In fact many of the shops which were on the road side did not have electricity. Only few portions (major market area) had electricity and connectivity. 

 

1.5             During the its first visit to the State the committee was informed that the Department had undertaken to allot codes to all fair price shops and their data was being uploaded on the computer. During the later visit the committee enquired from the officials in respect of the progress of the said codification, the committee was informed that the same was still in progress.

 

1.6             The State of Uttrakhand unlike other states has not taken any initiative towards automated computerised models. The Committee visited the District NIC centre at the Uttarkashi District to get an idea in respect of the scope of computerisation especially in the hill region. The committee met Shri D.C Tahpliyal, who was the incharge of the NIC Centre in the Uttarkashi District.  He submitted that the NIC had district centres in all the districts in the State. He further submitted that under the E-Governance a Common Service Centre (CSC) was established at the Block and Tehsil level.  He further submitted that Comat Technology was awarded the contract of establishing the CSC in the Uttarkashi District and that they would be in a better position to explain the same.

 

1.7             A Common Service Centre is a place where a computer system is installed at the block/tehsil level. The said system would be connected to the internet and would provide basic services like e-banking etc to the people of the respective block/tehsil. The Committee was also informed that the Common Service Centre was also established in the inaccessible areas of the district as well. In order to understand the functioning of the CSC especially in the inaccessible areas, the Committee met Sh. Asjit Singh Rawat, District Manager Comat Technologies.

 

1.8             Shri Rawat informed the committee that under the Central Government’s scheme a Common Service Centre was established in all the States of the Country. In the State of Uttrakhand his company was looking after the establishment of the CSC in Dehradun, Rudraprayag, Tehri Garwal and Uttarkashi District, whereas in the other districts Reliance was establishing the CSC. He further submitted that on a general rational one CSC had to be established for every 6 villages and the following table was provided by Shri Rawat showing the number of the CSC to be established in the districts his company has been awarded the contract.

 

Name of the District

Number of Villages

Number of CSC

Dehradun

980

163

Rudraprayag

691

115

Teri Garwal

1867

311

Uttarkhashi

699

117

 

1.9             Shri Rawat further submitted that in every CSC the company was setting up a computer system which was connected to the internet through broadband facilities and one of the department officials was trained to operate the same. However the Committee enquired as to how a CSC would be functional in those inaccessible areas where there is no electricity and connectivity. Shri Rawat submitted that his company was establishing approximately 16 CSC in the Mori Block (the said block has inaccessible areas of Yamunotri Region). He fairly admitted that his company had established the infrastructure in those areas but electricity and connectivity is the main problem. He further added that although under the contract the State Government was to provide the electricity and connectivity was to be provided by VSNL, but in areas where laying down  of wires was not possible, he submitted that  possibility of solar energy for electrical supply and usage of VSAT to run the CSC cannot be ruled out. However he could not provide further details in this regard he however indicated that the cost of establishing CSC would certainly go high if solar energy and VSAT are used.

 

1.10        The committee observed that apart from the establishment of the CSC under the E-Governance, there is no other development or proposal for introducing computerisation in the State for PDS.

 

1.11        While FCI godowns are computerized State godowns are not.  Committee was informed that Shri Amrendra Sinha, then the Secretary Department of Information Technology was of the view that all 22 godowns in Pithoragarh should be connected with computers.  22 computers were installed but were returned as there was no electricity.   Committee recommends that internal block godowns be immediately computerized like FCI godowns in order to achieve end to end computerization.

 

1.12        The Fair Price Shops are not computerized and the records are maintained in Registers. It is important before recommending any computerisation model for fair price shops to ascertain whether the conditions are feasible for an effective implementation of a computerisation model. It was observed that in plain region the fair price shops were located in places where the connectivity is possible. However in respect of the fair price shops in hilly region, it has been observed that the connectivity is very poor. During some trips it was found that the mobile signals were weak in some places especially in hill regions of Uttarkashi and Rudraprayag District. However during the visit to the villages in the hills of Rudraprayag the Committee found electricity connections.    

 

1.13        The Committee has recommended computerization of the Public Distribution System. Automated model recommended for PDS requires the availability of electricity and connectivity and apart from the said two factors the rough terrain should also be kept in mind while designing a system of computerisation. The CSC established by State Government under the E-Governance, can act as the connectivity hub for end to end computerization even in rural and inaccessible areas.

 

 

 

 


CHAPTER 9

RECOMMENDATIONS

 

1.                 There is an unholy nexus between the Transporters, Fair Price Shop owners, and the officials of the Department of Food and Civil Supply in large scale diversion of PDS food grains meant for the poor. PDS is inefficient and corrupt.  To stem the rot, the use of Information Communication Technology (ICT) appears to be the only solution.  By use of modern technology, there would be less human intervention and transparency will be brought in the system and in allotment of food stocks to be sold at the shops.

 

2.                 The Committee has given a comprehensive report on computerization and recommends that the same be acted upon. In the report the Committee has suggested the whole process of computerization of the Public Distribution System which includes using electronic weighing systems and integrating the same with automated allocation and delivery systems. The State must ensure that all godowns i.e. base godowns and block/internal godowns are electrified and provided communication facilities in order to facilitate end to end computerization.

 

3.                 One of the reasons for the failure of the system has been wrong identification of beneficiaries. Urgent steps need to be taken for proper identification so as to ensure there are no inclusion or exclusion errors. It may not be out of place to mention that the State Government has not adopted a BPL list based on the 2002 criteria.  The following recommendations made in the report for the State of Orissa in this regard are also recommended for the State of Uttrakhand.

 

i.                    There is a need to revisit income criterion prescribed for the BPL category.  The government/MORD committee may also consider using consumption criteria that is to say calorie intake per person per day as an indicator of poverty as the minimal objective to be achieved by TPDS is to ensure that every poor person gets two square meals a day. This is recommended in as much as a purely income based criteria may in certain circumstances be misleading in terms of actual determination of persons below the poverty line. However the estimation of poverty should not be made on a criteria which is less than the minimum wage fixed by the state for agricultural labourers or the wage fixed by the Central Government under Section 6 of the NREG Act 2005. It may not be out of place to point out that in several states including the state of Uttrakhand the minimum wage for agricultural labourer is in the range of Rs 100 and even the NSSO in its estimate fixes the estimate of expenditure at Rs 20 per capita per day which works out to Rs 100 per day per family (a family is taken as 5 members).

ii.                  The abovementioned Committee set up by the MORD is essentially to devise a criteria for identifying the correct beneficiary in a rural setting. For the urban scenario however a different criteria will have to be devised. The committee in its report on Delhi  had suggested that the basis for determination as to whether a person is BPL or not should be based on the minimum wage payable to an unskilled workman in the area i.e. to say if the person is earning below this amount he would be deemed to be below the poverty Line.

iii.                The Committee is also reiterating its suggestion/recommendation made in the Delhi report that the Concept of APL be abolished. The Committee is aware of the fact that there is going to be a great deal of opposition from the fair price shop dealers and other vested groups against the abolition of the APL category. If the Court is of the view that it may not be possible or desirable to abolish the APL category altogether, it may consider limiting the APL category to households whose annual income is Rs. One lakh. This is based on the fact that a class IV employee of the Central Government in Delhi gets a consolidated salary of about Rs. 8000/- per month making it Rs. 96,000/- annually. This category may be called “Marginally Above Poverty Line (MAPL)”. This limit may however be revised as and when required on a rational basis by the government. Reference may be made to the said report for a detailed analysis of the said recommendation and it may be added that the Committee in its visit to state after State has found that the concept of APL is serving no useful purpose for food security but is instead only a diversion tool.

 

 

4.                 Committee also recommends that all families of inaccessible and remote areas in the state  should be treated as BPL.

 

5.                 It is a proven fact that a stand alone FPS is not a viable proposition. Therefore it is recommended that Government should grant licence to existing Kirana/ Grocery shops. Selling non PDS items from the same premises certainly helps in increasing their viability. Standalone FPS should not be allowed as it is inherently an unworkable model and leads to malpractices. A system needs to be developed where general stores are given licences to sell PDS grains. There can be a restriction on sale of non PDS wheat and rice at such shops. The mere increase in commission will not in any way improve the viability of the FPS and the above suggestion in the view of the Committee is the only possible mean by which the FPS can become viable.

 

6.                 The Central Government should provide the subsidy for inaccessible and remote areas. Keeping in view the mandate of door step delivery, no burden of any kind for the transportation of goods especially in the hilly and inaccessible areas should be placed on the consumers.

 

7.                 The Department should ensure that as far as possible the FPS is allotted a minimum number of cards to some what viable. However it should be ensured that every Gram Sabha has one FPS and the practice of having one FPS for 2 or 3 Gram Sabha should be discontinued.

 

8.                 Political interference in the appointment of FPS must be done away with. There must be a clear demarcation of responsibilities amongst the different entities involved in the PDS. No entity must have an overlapping function. The prevailing system whereby all the entities involved in the PDS have interwoven responsibilities must be immediately done away with. The responsibility of identification of beneficiaries, issue of ration cards and the appointment of FPS and distribution has to be with the Food and Civil supply Department. Non officials can only be involved in Vigilance. When there is change in Government or Gram Pradhan, the question of cancellation of FPS or creation of another FPS or allotment of more units to a particular FPS should be strictly watched and recorded.

 

9.                 The facility of mobile Fair Price Shops, can be availed of for providing food grains in areas where the number of food cards/ration cards does not justify opening of a Fair Price Shop as per the norms. It is relevant to point out here that the Planning Commission provides funds under its plan programmes for strengthening the operational machinery of Public Distribution System.[18] The funds are, inter - alia, provided for schemes for purchasing mobile vans/Trucks for distributing essential commodities, where static/regular Fair Price Shops are not found viable/feasible. It is clarified that this suggestion is in addition and not in derogation with the suggestion made that every Gram Panchayat should have a fair price shop.  

 

10.             The authorities must ensure that in terms of the Uttaranchal Scheduled Commodities Distribution Order, 2003 samples are sent both to the godown as well as the fair price shop.

 

11.             The Government should take urgent steps to ensure that the godowns are adequately staffed and that proper promotional avenues are provided to inspectors so that younger and better motivated staff is available to monitor the PDS. Also inspectors should be provided with fixed allowance for visiting the FPS according to the region/area of the posting.

 

12.             The Government should also take urgent steps to ensure that the strength of the inspectors in all district offices should be increased in order to ensure that there is proper administration of the public distribution system.    

 

13.             Adequate communication facilities including landline telephones must be provided in all the godowns to ensure that there are clear communication channel between the DSO concerned, persons  incharge of godowns  and the FPS owners.

 

14.             Storage facilities at the State Godowns has to be augmented as it is found that inadequate storage space is one of the main reasons for delays in lifting and consequently in receipt of the PDS commodities by the beneficiary. 

 

15.             Various complaints by the FPS owners in regard to the delivery of the food grain from the godown to the FPS can be remedied by ensuring that the State Government provides free door step delivery of the PDS commodities. This is also a mandate of the PDS Control Order 2001. This would also help in making the FPS viable.

 

16.             Rates of transportation must be rationalized and modern technologies like GPS must be introduced to ensure that there is no diversion by the transporter.

 

17.             As of today, there is no enforcement worth the name and no vigilance. Vigilance Committees are non functional. Vigilance Committees should be composed of well meaning persons.  Vigilance Committees must meet on a fixed venue on a particular date and time, e.g. the District level Vigilance Committee should meet in the Office of the District Collector every second month on the second Friday at 4.00 P.M. Minutes of meetings of the Vigilance Committees should be recorded.

 

18.             District Magistarte should be made responsible for enforcement functions under the Public Distribution System.   

 

19.             The State Government should fix the responsibility of the officials of the administrative machinery to convene the meetings and ensure the presence of the members. Rules can provide that any member who does not attend two consecutive meetings would be replaced. The Secretary of the Department of Food and Supply should be responsible for convening the meetings at the State level, the District Magistrate should be responsible for the District level Committee, Block Development Officer should be responsible for the block and FPS level committees.

 

20.             PDS operation should be based on the principle of zero tolerance.  Any infraction of the rules and regulations or instructions should invite strict action not only against the FPS owner but also the concerned official.  It is the Inspector or his higher officers who should be held accountable.  Unfortunately, there is no accountability and there is no monitoring.  If a bogus card is found not only the FPS owner but the Inspector and other concerned officials as well should be prosecuted for offences under the Essential Commodities Act, 1955, Prevention of Corruption Act, 1988 and also Indian Penal Code.  It is a known fact that bogus cards are in abundance and it is another source of diversion of PDS food-grains. The State Government must devise a scheme to eliminate bogus cards. 

 

21.             A Complaint Redressal mechanism should be set up, with a twenty four hour Help line as suggested in report on Delhi. The toll free number of helpline should be printed on the ration cards.

 

22.             A post of Ombudsman/Regulator should also be created for the purpose of ensuring the transparent functioning of the system. If the State is unable to setup an Ombudsman as suggested then his tasks may be assigned to the District Judge or to an Additional District Judge in the district concerned.

 

23.             PDS food-grains should be transported only in tamper-proof bags like HDPE bags instead of jute bags and PDS commodities should be supplied to the beneficiary in small packages of 5 & 10 kgs. 

 

24.             Regional Food Controller should make budget provisions and deposit the money with FCI for lifting the quota for the month well with in time. Also adequate transport arrangements should be made for lifting the quota from the FCI on time.

 

25.             The advance allocation for the inaccessible areas during the rainy and winter seasons gets delayed as the Regional Food Controller of the Marketing wing does not deposit the money for advance allocation with the FCI within time. The Government should take strict action and fix the responsibility of the persons responsible for the delay in submitting the request and depositing of money for the advance allocation.

 

26.             The advance allocation should reach the state godowns in the inaccessible areas at least one month in advance before the season sets in. For example in case of monsoon season it should be June and in case of winter it should be November.

 

27.             The bills for reimbursement of transportation charges of FPS Owners for the AAY foodgrain are also being delayed for several years without sufficient cause. The Government should fix the responsibility for delay and the concerned official found responsible should be penalized. The Government should also pay interest to the FPS owners for the delayed payment. 

 

28.             There should be annual review of ration cards as provided under the PDS Control Order 2001.

 

29.             Foodgrain should be weighed in the Godown on arrival and also at the time of loading for delivery to another godown or the FPS.There must be electronic weighing machines in the godowns.

 

30.             PDS Control Order, 2001 provides that no eligible applicant should be deprived of a ration card under the Public Distribution System. It is therefore necessary that if the applicant is denied a BPL/AAY ration card, he should have an avenue to file an appeal.

 

 

 

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[1] These details are as per Form C sent under Clause 6 of the PDS Control Order 2001 by the State Government to the Central Government for the Month of July 2008.

[2] The information has been taken from the website: http:/ en.wikepediaorg/wiki/uttarnchal.

[3] Field Visit Report dated 1.5.2008

[4] Minutes of the field visit on 2.10.2008

[5] Minutes of the field visit to Badhrbad State Godown,  on 5.10.2008

[6] Minutes of the Public hearing dated 5.10.2008 at Haridwar.

[7] Field visit report dated 05.05.2008 at Haridwar.

[8] Minutes of the visit report dated 16.06.2008.

[9] Response of the Department dated 17.04.2008 

[10]  Minutes of the field visit on 27.09.2008

[11] Extract of Report of the Working group on PDS and food security for the 10th Five Year plan (2002-2007)

[12] Visit report dated 19.06.2008 of the field visit report to Tehri District.

[13] Minutes of Meeting dated 1/5/08 with officials of the Food and Supplies Department.

[14] Minutes of the field visit dated 27.09.2008.

[15] Minutes of the field visit dated 28.09.2008

[16] Minutes of the field visit dated 29.09.2008

[17] Food bulletin , Ministry of food and civil supply , of April 08

[18] Extract of Report of the Working group on PDS and food security for the 10th Five Year plan (2002-2007)