DRAFT INSPECTION REPORT ON THE ACCOUNTS OF THE

HEADMISTRESS, GOVERNMENT BUNGKAWN HIGH SCHOOL, BUNGKAWN,

AIZAWL, MIZORAM FOR THE PERIOD FROM 01.04.2008 TO 31.10.2013
PART-I
1

Introduction:

The accounts of the Headmistress, Government Bungkawn High School, Bungkawn,

Aizawl, Mizoram for the period from 01.04.2008 to 31.10.2013 were test checked by an audit
party from the Office of the Principal Accountant General Mizoram from 11.11.13 to
13.11.2013.
2

Incumbency:
Pi. R. Laltanpuii held both the charges of the Headmistress as well as Drawing and
Disbursing Officer during the period covered by audit.

Budget Allotment and Expenditure:

(` in lakh)

Budget Allocation
Year

Budget Expenditure

Plan

NonPlan

CSS Total Plan

2008-09

Nil

39.16

Nil

39.16

Nil

2009-10

Nil

42.85

Nil

42.85

Nil

2010-11

Nil

73.80

Nil

73.80

Nil

2011-12

Nil

72.85

Nil

72.85

Nil

2012-13

Nil

82.61

Nil

82.61

Nil

2013-14
(upto
31.10.13
)

Nil

80.02

Nil

80.02

Nil

NonPlan
39.1
4
42.8
4
73.8
0
72.8
5
82.5
9
63.8
1

Excess(+)
Savings(-)

CSS

Total

Nil

39.14

(-) 0.02

Nil

42.84

(-) 0.01

Nil

73.80

Nil

Nil

72.85

Nil

Nil

82.59

(-) 0.02

Nil

63.81

(`` in lakh)
Year
2009-10

Opening
Balance
Nil

RMSA FUND
Fund
Total
Received
65000
65000

Expenditure
incurred
65000

Closing
Balance
Nil

2010-11
2011-12
2012-13
2013-14
( 31.10.13)
Total

Nil
79623
125250

267873
796848
1509663

267873
876471
1634913

188250
751221
1346194

79623
125250
288719

288719

211285

500004

499930

74

493592

2850669

3344261

2850595

493666.00

Review of outstanding Inspection Reports:

Nil, as it was the first audit conducted since its inception.

5.

Disclaimer Statement:
The Inspection Reports has been prepared on the basis of information furnished and
made available by the Headmistress, Government Bungkawn High School,
Bungkawn, Aizawl, Mizoram. The office of the Principal Accountant General,
Mizoram, Aizawl disclaims any responsibility for any misinformation and/or noninformation on the part of the auditee entity.

PART-II A
Nil

PART-II B

Para-1

Loss of Government Revenue:

(i)

Non-deduction of Mizoram Value Added Tax

As per the Mizoram Value Added Tax Rule 2005 Chapter III Clause 7 (5)(d) read with
Chapter XI clause 84 (1) (g), works contract costing ` 3 lakh and above is taxable at the
rate of 2 percent of amount paid in respect of such works contract.
The Taxation Department vide its letter No.C.11021/1/2012-COMTAX/118 Dated the 2 nd
June 2012 issued to all Heads of Departments/Offices, Government of Mizoram/Government
of India clearly mentions that Tax Deduction at Source @ 2% of the sum paid in respect of
all Works Contract should be made in all payments made in respect of works executed except
in such cases where TDS are not required as mentioned under the provision of Section 84(1)
of MVAT, Act.
Further, as per the Office Order vide No.D.11025/1/13 (I)-RMSA DPO dated 19.09.2013
issued by the Office of the District Programme Co-ordinator, RMSA, Aizawl District,

Mizoram on partial modification and continuation of the State Project Director, RMSA
Mission letter No.D.11029/4/11-MEMS (RMSA) dated 16.09.2013: ..all Civil Works must
be tendered and deduct 2% MVAT and 1% CESS by the concerned authority (SMDC) from
the work manager/contractor upon the total construction value/cost.
During the course of test check of the records of the Headmistress, Government Bungkawn
High School, Bungkawn, Aizawl, it was observed that, the work for construction of the
school under RMSA (Strengthening) was awarded to one contractor/ Work Supervisor,
Pu.Lalhuma, Mission Veng. The estimated cost of the work was ` 18,49,600 and payment
made to the contractor against work executed till date (November 2013) was ` 19,39,348.
However it was noticed in audit that, while making payment for the work, Mizoram Value
Added Tax (MVAT) was not deducted from the contractors bill, thereby resulting loss of
Government Revenue to the tune of ` 38787.00 2% of ` 1939348.00
The reason for non deduction of MVAT as required under the above MVAT Rule 2005 as well
as the instruction of the Taxation Department may please be stated and necessary recovery
may please be made from the contractor by intimation to audit.
The Headmistress stated that no proper instruction was received from the higher authority to
deduct MVAT during sanctioning of the fund.
Excess payment of ` 0.90 lakh to the contractor under School
Strengthening-observation thereof.

(ii)

During the course of test checking of records of the office of the Headmistress, Government
Bungkawn High School, Bungkawn, Aizawl it was observed that, for the construction of
school-laboratory and library building under RMSA (Strengthening), the work was awarded
to Pu. Lalhuma of Mission Veng as Work Manager/Contractor and an agreement was signed
on 27.01.2011 and 22.06.12 respectively for an estimated work value of `18,49,600.00 (=
`755000.00+ `1094600.00).
Further, test check revealed that the total amount paid to the contractor was ` 19,39,348
Hence there was an excess payment of ` 89,748.00 ( = ` 19,39,348.00 - ` 18,49,600.00) on
the date of submission of the Completion Report by the Chairman SMDC to the Headmistress
as detailed below:
Sl.N
o
1
2
3
4
5
6
7
8
9
10

Date of payment
10.02.11
01.08.11
01.08.11
12.12.11
13.07.12
11.08.12
29.10.12
13.12.12
31.05.13
14.10.13
Total

Cheque No

Amount

349417
349423
349422
349429
740559
740560
740564
740570
0941929
0941932

113250
156848
79623
264250
109460
397755
313733
149494
273650
81285
1939348

Bank Account
S.B.I Mission Veng
Branch, Aizawl

M.R.B Khatla Branch,

Aizawl

In this connection reasons the following observations were made in audit:

1)

The reason for excess payment made by the DDO was not on record.

2)

Non maintenance of auditable documents/records on work (Strengthening)

like approved estimate, MB, vouchers, etc except signed agreement and
completion report

Comments may please be furnished by the DDO on intimation to audit.

The responsibility of signing the agreement and making payment lies with the SMDC only as
per the Instruction of the higher authority. The matter will be looked into and appropriate
reply will be furnished in due course stated the Headmistress.
(iii)

Non-realisations of Government Revenue

According to letter no. G16018/1/2005-DTE (EDN) dated 19th Feb, 2010 of Directorate of
School Education, Government of Mizoram, ..all the Headmasters of the respective schools
under Govt. of Mizoram had to collect revenue like receipt on account of RTI, Housing, Sale
proceed of Transfer Certificates (T.C), Admission fees, Fines and any other Revenue Receipt
and should be Deposited into Treasury and a copy of the Treasury Challan month-wise
should be sent to the Directorate regularly.
Also, Rule 7(1) of Central Treasury Rules (CTR), VOL. I , which is applicable in the state of
Mizoram provides that ...all moneys received by or tendered to Govt. on account of the
revenues of the Govt. shall , without undue delay be paid in full into Treasury and shall be
included in the accounts of the Government. Moneys received as aforesaid shall not be
appropriated to meet departmental expenditure or not kept apart from the accounts of the
Government.
In course of test check of records (November, 2013) of the Headmistress, Government
Bungkawn High School, Bungkawn, Aizawl it revealed that only Professional Tax amounting
to `1,95,080.00 (Rupees one lakh ninety five thousand eighty) was collected as instructed by
the Taxation Department and deposited the same into Treasury as Revenue collected during
2008-09 to 2013-14 excluding the admission fee, fine, etc from the enrolled students.
The details of year wise revenue collection (admission fee, Transfer Certificate, test fee,
report card, and IT fee) and remittance into treasury are shown as tabulated under:-

Year
2008

2009

2010
2011
2012
2013

VIII
IX
X
VIII
IX
X
VIII
IX
X
IX
X
IX
X

No. of
students
39
67
76
49
50
36
37
55
34
56
40
28
43

IX

48

Class

X
57
Grand Total

Total
No of students

Total admission fee collected

@ ` 30 per student

182

135

126

NIL

96
73
105
717

Nil

In this regard, comments on the unrealistic and intentional non-compliance of the codal
provisions stated above by the concern official/authority may please be furnished by
intimation to audit.
The Headmistress stated that audit observations will be looked into and reply will be
furnished in due course. Also appropriate steps will be taken to comply with the Government
instructions so mentioned in future.

Para-2

Award of work without call of tenders

As per para number 14.1 of CPWD Works Manual Tenders should be called for all works
costing more than ` 50,000. Except in urgent case or when it is expedient to do so, works
may be awarded without call of tender after the approval of the competent authority.
Also as per chapter 4.3.2 (a) of Manual for Financial Management and procurement for
Rashtriya Madhyamik Shiksha Abhiyan (RMSA), Major Civil Works beyond ` 10 lakhs or
limit specified in GFR, whichever is lower is to be executed through an external agency
(which could be PWD or a state level agency or single or multiple contractors at state level
through competitive bidding).
During the course of test checking (November 2013) of the records of the Headmistress
Government Bungkawn High School, Bungkawn, Aizawl it was observed that during 200910 to 2012-13, construction of the school (strengthening) under RMSA with an estimated
value of ` 18.50 lakh (= `755000 + `1094600) was undertaken through a contractor/work
manager.
Payments for the construction were done by the School Management and Development
Committee (SMDC) to Pu. Lalhuma, works managers/contractors who was awarded without
call of tender, thereby debarring the benefit of competitive rate which could have been

availed through the process of competitive bidding. Also, the reason for awarding the works
without call of record was not kept on record.
The reason for non observance of the quoted rules in awarding the work in contravention of
the above rules may please be stated.
The award of work / selection of work manager were done at the SPO level. The
responsibility of the SMDC lies the signing of the agreement and making payments only as
per the instruction if higher authority said the Headmistress.

Para-3

Non maintenance of Stock Register (RMSA) - observations thereof:-

As per General Financial Rules 106 and 116 to 119 stipulate that all materials procured for
an office should be examined, counted, measured or weighed when delivery is taken from the
firm/supplier.
The physical verification of stock/store should be done at least once in every year and a
certificate of verification with its results should be recorded in the Stock Register.
All discrepancies, shortages and damages, along with the position of unserviceable stores
shall be brought to the account and reported immediately to the competent authority.
It was noticed in audit that the School neither maintained Stock Register nor any documents
relating to the distribution of the procured items. No certificate was also recorded on the body
of the bill. In the absence of any stock certificate on the suppliers bill body and nonaccountal of the materials in stock registers the veracity of purchase of materials, equipments
and utilisation thereof could not be ascertained and vouchsafed in audit.
Comments may please be furnished to audit.
The Headmistress stated that necessary records will be maintained accordingly as instructed
by audit.

PART-III
Nil

Dy. Accountant General