Anna University: Irregularities reported in printing digital certificates; CAG says varsity paid Rs 11.41 crore for incomplete work

Two Bengaluru-based software companies appointed to digitise educational records at Anna University between 2012 and 2016 were fraudulently paid Rs 11.41 crore for work they have not done, said the Compliance Audit report for 2020-2021 of the Comptroller and Auditor General of India (CAG).

The CAG report, tabled in the Assembly on Wednesday, October 19, also flagged huge irregularities in awarding the contract worth Rs 65 crore to a two-month-old company to print blank certificates on water and tear-resistant paper with additional security features.

A step towards digitisation 
In February 2016, Anna University's Controller of Examinations (CoE) proposed to digitise all educational records of students between 2012 and 2016, including degree certificates, rank certificates and grade/mark sheets. Accordingly, the CEO entered into an MoU with private companies GA Software Technology and Matrix Technologies Inc.

Documents revealed that GA Software Technology was paid to digitise 20.92 lakh records, but digitised only 7.33 lakh documents. Similarly, Matrix Technologies Inc was paid to digitise 1.2 lakh records but didn't digitise any.

The CoE issued a purchase order, signed MoU, accorded financial sanction, and passed contractor bills of Rs 11.41 crore to both companies without the approval of the Executive Committee and Syndicate of the University said the CAG report.

In July 2016, to eliminate bogus certificates, the CoE proposed to print blank certificates on water and tear-resistant paper with additional security features.

Instead of inviting open tenders, the CoE called for quotations from nine firms without mentioning the required quantity and security features. The contract was given to the lowest bidder — IFF Limited — which was not on the approved panel of the Indian Banks Association (IBA). IFF Limited was paid Rs 65.46 crore to supply blank certificates between November 2016 and September 2017.

The audit report said the university, which had been purchasing one year's requirement of blank certificates, has procured 8 to 13 times (1.8 crore blank certificates) the yearly requirement.

The annual requirement of blank certificates to print grade/mark sheets is 11.98 lakh (2016-20). Similarly, 20 lakh blank sheets were purchased as against the yearly need of 1.86 lakh for provisional certificates. For the printing of consolidated and degree certificates, 20.3 lakh and 20 lakh new documents were purchased, while the annual requirement was 1.5 lakh and 1.81 lakh respectively.

What the report revealed
"As of September 2021, about 50% of blank certificates worth Rs 34.29 crore are available in stock. In 2016-17, the value of blank certificates procured in excess is Rs 57.14 crore," revealed the report. The report observed that the CoE did not indicate the exact quantity while submitting the proposal to the convener committee. The annual budget for printing blank certificates was increased to Rs 65 crore from Rs 15 crore without any objections or clarifications.

The company IFF Limited was incorporated only on August 4, 2016, just a few weeks before getting this purchase order on October 6, 2016.

Quoting the database of the Ministry of Corporate Affairs, the audit report said IFF Limited was a sister concern of GA Software Technology, which bagged the order for digitisation in February 2016.

The report also said IFF Limited did not print and supply the blank certificates on its own but sourced them from a Maharashtra-based firm. "CoE did not object to this arrangement. Tacit approval by CoE for subcontracting of work to another supplier proved that the issue of confidentiality cited by her for resorting to limited tender farce," said the report.

The Higher Education Department, in its reply to the CAG, said an order was issued in February this year to inquire into the role of the officials in fraudulent payment to contractors for digitising educational records and irregularities in printing blank certificates. However, the CAG said the government did not specify the details of the action taken to recover the payment made to the contractors.