NAVVNEET DUBEY
Jammu: The Comptroller and Auditor General (CAG) has pointed out that twenty Public Sector Enterprises(PSEs) reported losses of Rs 252.53 crore and net worth of 14 PSEs was completely eroded by accumulated losses. The report for the year ended March 2023, prepared under Section 72 of J&K Reorganisation Act, 2019, tabled in J&K Legislature today.
The findings are part of the CAG’s Report No. 03 of 2026 on the Government of the Union Territory of Jammu and Kashmir, which the J&K legislature received on Wednesday.
The composite audit report covers public sector enterprises, execution of NABARD-funded works and the Integrated Financial Management System (IFMS)
As on March 31, 2023, there were 42 PSEs in J&K — 39 government companies, two statutory corporations and one government-controlled company.
Six were inactive, 36 active. Power sector accounted for 78% of total investment. As per latest finalised accounts, only 11 PSEs were profit-making and only J&K Bank Limited declared/paid dividend. Profit rose to Rs 1,286.79 crore in 2022-23 from Rs 566.10 crore in 2021-22.
Twenty PSEs reported losses of Rs 252.53 crore and net worth of 14 PSEs was completely eroded.CAG recommended early liquidation of inactive PSEs and remedial action for loss-making units.
Of 34 PSEs whose 2022-23 accounts were due, only four submitted financial statements by Sept 30, 2023. Nineteen had arrears of three years or more. Two statutory corporations — J&K Road Transport Corporation and J&K & Ladakh Financial Corporation — had arrears of two years or more.
CAG said government investments remain outside legislative oversight. Audit of 33 PSEs found only J&K Bank had appointed required Independent Directors though 10 were required to.
Similarly, only J&K Bank constituted Audit Committee and Nomination and Remuneration Committee out of 10 required. Only two of eight eligible PSEs appointed whole-time Company Secretary, one had part-time and five none.
Only nine held required Board meetings and AGM was not held in 24 of 33.Government was asked to ensure Companies Act, 2013 compliance. On CSR, of nine PSEs meeting criteria, only four had CSR Committees and policy. Of seven required to spend in 2022-23, only three spent.
Meanwhile, as per report Jammu and Kashmir could complete only 32 of 263 projects taken up under the NABARD Rural Infrastructure Development Fund (RIDF) that were due for completion by March 2023, leaving 231 either incomplete or unstarted, while Rs 461.67 crore of the Rs 844.17 crore released for the projects remained unutilised.
The performance audit covering the period from April 2018 to March 2023 found that only 12 per cent of the projects due for completion had actually been completed by March 2023. Of the Rs 844.17 crore released during the five years, only Rs 382.50 crore, or 45 per cent, had been spent.
The audit also found deficiencies in the management of mobilisation advances by the Finance Department, including delays in releasing advances to implementing departments, non-release or excess disbursement and cases where advances were not utilised. The CAG said these deficiencies adversely affected cash flow and timely execution.
Against the Government of India’s consent for raising Rs 3,900 crore in loans from NABARD during 2018-19 to 2022-23, J&K availed only Rs 2,316.37 crore, or 59 per cent.
The CAG said NABARD’s disbursement against sanctioned loans ranged between 28 and 84 per cent across tranches, primarily because of slow progress of works, with loans lapsing in several cases because prescribed timelines were not adhered to.
The CAG said deficiencies in the business process re-engineering exercise and failure to revise the detailed project report in accordance with Government of India instructions resulted in J&K losing central assistance of Rs 11.88 crore for implementation of IFMS. It also found that Rs 5.26 crore earmarked for upgrading the State Data Centre remained misutilised, while the IFMS applications were hosted on the NIC Mini Data Centre at Jammu without a supporting backup site.
The CAG has recommended, among other measures, stronger project planning and monitoring, timely release and utilisation of funds, completion of statutory and technical approvals before execution, improved corporate governance in PSEs and a comprehensive overhaul of IFMS, including role-based access controls, multi-factor authentication, audit trails and disaster-recovery arrangements.
