Rs 1237-Cr PHED scam: 17,682 iron removal plants procured, none functional!

Guwahati, March 22: A multi-crore corruption scandal has been unearthed in Assam’s Public Health Engineering Department (PHED), exposing bid manipulation, financial irregularities, and political interference in the procurement of mobile iron removal plants (IRPs) and filtration systems.

Investigations reveal that what was meant to be a life-saving initiative for flood-stricken communities turned into a well-oiled corruption machine benefiting a select few at the cost of public welfare.

The scale of corruption is staggering—17,682 iron removal plants (IRPs) were procured for a whopping Rs 1,237,740,000 but these plants were delivered by an enterprise without the essential Mark 2 pumps, rendering the former completely useless.

Notable, the iron removal system can only function if the Mark 2 pumps are installed along with the IRPs, but officials ignored this critical flaw, exposing the fraudulent procurement process.

Tender Manipulation and Ghost Procurements

In 2011-12, the PHED floated a tender for 17,682 mobile IRPs, each valued at ₹70,000, meant to provide clean drinking water in flood-affected areas. However, instead of serving their intended purpose, the plants were left to rust due to unavailability of Mark 2 pumps, exposing deep-rooted corruption in the department.

The PHED warehouse premises in Betkuchi

The tender process was deeply flawed from the start. The notice was discreetly published in one AdinorSanbad, a newspaper with limited circulation, preventing genuine competition. “For a project of this magnitude, the NIQ should have been published in national and state dailies with substantial circulation. This act of the Chief Engineer's office could not have but one motive—suppressing information from reaching eligible bidders,”a report submitted by PK Tiwari, Principal Secretary to the Government of Assam in 2017, reads.

Further, the bid document lacked clarity regarding the nature of procurement. It did not specify whether the tender was for empanelling agencies or selecting a single supplier, creating ambiguity in financial commitments. The number of plants to be procured was also not mentioned, which was a crucial omission affecting earnest money and security deposits.

Notably, none of the five selected bidders had prior experience in manufacturing or supplying water treatment plants. Instead, they were dealers in electrical, hardware, and stationery items. The Tiwari report further said, “None of the bidders submitted financial documents like balance sheets or previous supply orders. They got away with it because the department neither set eligibility criteria nor invited techno-commercial bids, which are necessary for such projects.”

The bidding process itself was murky. Bidders were given only nine days to submit proposals, violating Central Vigilance Commission (CVC) guidelines. Moreover, their signatures on the submitted documents appeared forged, as there were no details about who signed them or their authority to do so.

“As per standard procedure, bids are opened in the presence of bidders or their representatives, and their signatures are recorded. This was not done, raising suspicions that the process was manipulated in a hush-hush manner,” the report further added.

Another glaring irregularity was the absence of brand names or manufacturing details in the bids. Despite this, the Tender Committee proceeded with approval without evaluating product quality or specifications.

The committee itself was compromised—two of the three members did not sign the minutes of the meeting, raising further questions about procedural integrity.

Mobile water treatment equipment at the warehouse in Betkuchi

RTI activist uncovers the scam

The scandal came to light when an RTI activist (name withheld on request) noticed the abandoned IRPs in the PHE Department’s Store & Workshop Division, Betkuchi, Guwahati, and filed an application seeking procurement details. His findings revealed:

• Missing bid evaluation reports and financial records.
• Manipulated tender processes favouring pre-selected firms.
• Deliberate attempts to suppress information and hinder accountability.

In 2017, the activist escalated the matter to the Chief Minister’s Vigilance Cell, prompting a raid at the PHED office in Betkuchi. Officials under Additional SP, CM Vigilance, Pallab Tamuli, seized 22 crucial files detailing payment records and procurement approvals.

The raid exposed the financial mismanagement surrounding one H R Enterprise, the primary contractor benefiting from the scam.

In 2018, the Executive Engineer of PHE Department, Kishore Kumar Talukdar was replaced by Tapan Bordoloi.

H R Enterprise: Key player in financial irregularities

Despite the ongoing investigation and seizure of the 22 files, H R Enterprise continued receiving payments until May 2019. Payments were processed for its Jyotinagar office in Bamunimaidan, even as its Bhetapara facility remained under scrutiny.

Between 2018 and 2019, the firm received payments totalling Rs 1,237,740,000, despite its financial records being under investigation. Payments were cleared without proper documentation, bypassing standard financial verification procedures. Internal audits flagged multiple anomalies, yet no corrective action was taken.

Even other firms implicated in the scandal continued receiving payments (the records of which are with The Assam Tribune), raising suspicions of a larger corruption nexus involving officials and contractors.

Political interference & cover-ups

The Tewari report implicated high-ranking political figures in procurement decisions. Then PHED Minister Gautam Roy allegedly ensured that contracts were awarded to pre-selected firms, even though they lacked qualifications.

When Kishore Talukdar took charge as executive engineer, he halted payments to H R Enterprise, citing irregularities. However, after Talukdar was transferred, his successor Tapan Bordoloi swiftly released the pending funds, raising suspicions of political pressure in enabling payments.

Amid rising concerns over the abandoned iron removal plants, the RTI activist filed a request for transparency from the government. Seeking clarity on the state of affairs and the reasons behind the neglect, the activist's petition aimed to hold authorities accountable for the wasted infrastructure.

However, response from the Chief Minister Office in 2024 clearly mentioned that the requested information “does not exist and is not available as part of the official records”.

This evasive reply has only deepened the sense of frustration, raising suspicions about a possible cover-up. The present situation depicts a grim picture of the discarded IRPs lying in the PHE Department’s Store and Workshop in Betkuchi.

'Not a waste, ready for future use,' says PHE Dept

When The Assam Tribune contacted Public Health Engineering (PHE) officials, an official, speaking on condition of anonymity, revealed that 227 iron removal plants are currently stored in the department’s workshop. Of these, 211 have been allocated to Guwahati Division I (Kamrup) and 11 to Dibrugarh Division.

Despite the allocation, these divisions have yet to transport the plants to their designated locations.

“These iron removal plants are of little use at present, as hand pumps and tube wells are rarely utilised anymore,” the official explained. “With the Jal Jeevan Mission (JJM) shifting focus to piped water supply, the relevance of these plants has significantly diminished.”

Iron removal plants rusting in the warehouse in Betkuchi

When asked whether the investment in these plants had gone to waste, the official maintained that they remained in good condition. “They are properly stocked under shade and can be used whenever the government or department issues an order.”

The official added that the head office is regularly updated on inventory status. “We have already informed them about the 227 iron removal plants stored in the warehouse,” he said.

As the monsoon season approaches and floods loom, the spotlight turns to the fate of discarded IRPs meant to ensure safe drinking water in flood-prone areas.

All eyes are now on Cabinet Minister Jayanta Mallabaruah and the current administration to see if they will address the issue or let the plants become mere symbols of failed promises.