State-owned Pawan Hans Helicopters Limited (PHHL) has not collected dues worth over Rs 171 crore as it lacks a proper system for expeditious recovery of debts, government auditor CAG has said. "There was no system for timely recovery of debts due to which there was huge outstanding of Rs 171.87 crore as on March 31, 2012, necessitating implementation of credit control procedure," Comptroller and Auditor General (CAG) said in a recent report.
Of the outstanding amount of Rs 171.87 crore, about Rs 42.22 crore has been pending for the past one to 16 years from debtors including state governments, it said. The auditor also noted that the amount of Rs 171.87 crore, as on March 31, 2012, had further increased to Rs 192.10 crore by the end of December 2012.
It observed that the huge outstandings were due to "lack of timely and vigorous follow up by the management with the debtors as there was no system in place for timely recovery of debts."
PHHL could not recover an amount of Rs 3.84 crore from the governments of Arunachal Pradesh and Punjab "as services were provided to them without any formal contract". "The position of outstanding was critical in view of the fact that the Company had to pay interest of Rs 14.46 crore on loans of Rs 232.83 crore during 2011-12," the CAG said.
In their response to CAG, the PHHL management accepted that delays in signing of contracts with governments of Arunachal Pradesh and Punjab had led to non-realisation of dues. "Thus, failure of company to recover dues led to borrowing to finance its operations resulting in further outgo on account of interest," the CAG report said.
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