Kullu: A special CAG audit ordered by the Himachal Pradesh high court has uncovered a series of alleged irregularities in land acquisition and compensation disbursement for the Kiratpur-Nerchowk four-lane highway project. These include irregular payment of Rs 8.29 crore to 52 encroachers for structures built on govt land, alongside other compensation discrepancies exceeding Rs 14 crore.The audit followed directions from the high court during hearings on a writ petition filed by Madan Sharma, general secretary of the Four Lane Visthapit and Prabhavit Samiti, a Bilaspur-based organisation advocating for people displaced by highway projects. The petition alleged irregular land acquisition, compensation to encroachers, and unauthorised deviations in the project’s alignment. On July 24, 2024, the high court asked the National Highways Authority of India (NHAI) to explain how compensation was paid to alleged encroachers. Unsatisfied with the NHAI’s response on Sept 17, 2024, the court directed the CAG the following day to conduct an independent audit. The CAG initiated the audit on March 7, 2025, and conducted field verifications between March 19 and June 13, 2025, examining 317 land acquisition awards involving 11,840 beneficiaries before submitting its report. The report revealed that Rs 8.29 crore was disbursed between April 2015 and Oct 2020 to 52 beneficiaries across 19 awards for structures erected on govt land. Despite statutory provisions prohibiting govt land encroachment, “the NHAI compensated encroachers instead of initiating eviction proceedings,” the report said. Acquisition records lacked evidence proving that beneficiaries held ownership rights or that the structures were registered before acquisition notifications were issued. While the NHAI asked the Special Land Acquisition Unit (SLAU), Bilaspur, to initiate recovery proceedings in May 2018, no action was taken until May 2025. The audit flagged an irregular payment of Rs 9.72 crore in interest awarded for structures and trees. It pointed out that the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013, permits a 12% interest payment only on the market value of land, not on structures or trees. Forty awards issued between 2015 and 2018 erroneously applied interest to structures and trees, resulting in excess payments, the report said. The CAG termed this an avoidable loss to the public exchequer and recommended immediate recovery.The audit revealed that the valuation of 20 affected structures was completed before Jan 1, 2015, the cut-off date after which solatium and interest became applicable under the 2013 Act. However, the corresponding awards were announced only between Dec 2015 and Oct 2016, a delay of 15 to 27 months. This delay resulted in an avoidable expenditure of Rs 3.97 crore, the report said, adding the NHAI offered no substantive reasons for the delay. The report also questioned the methodology used to determine compensation rates across 18 acquired revenue villages, noting sharp variations between original awards in 2013 and supplementary awards issued between 2015 and 2023. In several villages, rates plummeted, while in others they rose dramatically. For instance, compensation in Dadour village declined from Rs 58 lakh to Rs 15.56 lakh per bigha, whereas in Bhour village it surged from Rs 58 lakh to Rs 1.13 crore per bigha, according to the report. The audit observed that these wild fluctuations point to the absence of a transparent, evidence-based valuation methodology. The CAG highlighted an irregular payment of Rs 70.23 lakh for water supply, sanitation, and electricity installations. In multiple cases, extra compensation was paid for incomplete buildings or agricultural sheds that lacked functional utilities, often without any physical verification. Additionally, in seven cases, a literal double payment occurred; Rs 49.04 lakh was disbursed against an entitlement of just Rs 24.52 lakh. In another instance, a mismatch between revenue records and the evaluated area led to an excess payment of Rs 26.14 lakh. The audit also flagged the NHAI’s failure to promptly inform the forest department about changes to the project’s alignment. Despite approving modifications for Tunnel-2 and Tunnel-3 in 2013, the NHAI failed to initiate formal correspondence with the forest department for over five-and-a-half years after initial forest clearance was granted. Action was only taken in 2019 after the divisional forest officer, Bilaspur, received complaints regarding alignment deviations and illegal dumping in forest areas.IRREGULARITIES EXPOSED Compensation paid for structures on govt land | Rs 8.29 crore Interest paid on structures and trees | Rs 9.72 crore Avoidable payment due to delayed awards | Rs 3.97 crore MSID:: 131720015 413 |
