New Delhi: A senior official of the CAG, which had prepared a report on the Commonwealth Games malpractices, is himself under the scanner of a High Level Committee that went into the irregularities of the mega sporting event.

In its report submitted to Prime Minister Manmohan Singh, HLC headed by former Comptroller and Auditor General V K Shunglu has said that R S Mathrani, presently Director General in the CAG, has followed an "arbitrary" procedure to select Engineers India Limited (EIL) as project management consultant during his tenure as Finance Officer in Delhi University.

Interestingly, Mathrani has contributed to CAG's report on Commonwealth Games irregularities which indicted Delhi Chief Minister Sheila Dikshit and certain officials of her government.

According to the report, in one of its notes Mathrani recorded that EIL would be invited to make a presentation to the Works Advisory Board and, if found suitable, price negotiations would be carried out to finalise the consultancy fees.
"If EIL is not found suitable then other PSUs would be invited to make a presentation," it said.

"Having such a condition for selection of agency clearly demonstrates that other identified agencies were not offered equal opportunity to be selected. EIL was given preference over others by inviting them to make presentation to Work Advisory Board.

"No opportunity was given to other agencies – Rites Limited & Engineering (Projects) India Limited-- to make similar presentations," the Shunglu panel pointed.

The Committee felt that the consultancy fee of Rs 23 crore to EIL was very high and unjustified. The contracted fee of M/s EIL was Rs 23 crore (9 per cent of Rs 255 crore) and additionally International Architect was also paid Rs 2.88 crore. Thus, total consultancy fees paid was Rs 26 crore which is 10 per cent of total project fees.

"HLC feels that the consultancy fees of 10 per cent is very high and proper consideration should have been given to other alternatives before awarding the contract to M/S EIL at such a high cost," the report said.

Based on Mathrani's recommendation, University Engineer sent a letter to M/s Engineers India Limited informing them of their appointment vide letter dated May 14, 2007. "The procedure was highly arbitrary, selective & unethical," the High Level Committee said.

The Committee, questioning Mathrani's decision, said that "no details were available on record for initial estimate of Rs 100 crore by Delhi University which was revised to Rs 224.27 crore by EIL. Further no supporting documents/detailed analysis of rates was available based on which estimate for Rs 224.27 crore was prepared by EIL," it said.

"HLC is of the view that appointment of EIL was not transparent & justified," the report read.

"An internal email note was found during the review in which the EIL Project Manager acknowledged the fact that M/S EIL was having a profit of over 50 per cent on the total consultancy fees paid by DU for the work. This clearly demonstrates that the fee paid to EIL was unjustified," the report said.

The Prime Minister had in October last year formed a High Level Committee under the chairmanship of former CAG V K Shunglu to find out alleged irregularities in executing Commonwealth Games held here in October 3-14, 2010.