I’m capable of handling CBI, principal secretary told Delhi CM

The CBI investigation against the Delhi government’s principal secretary, Mr Rajendra Kumar, in a corruption case reportedly centres around 10 key questions related to awarding of tenders to the Endeavour Systems Private Limited through Intelligent Computer System India Limited (ICSIL), which allegedly had caused a loss of about Rs 10 crore to the state exchequer.

A highly-placed source said that Mr Kumar is said to have briefed chief minister Arvind Kejriwal late on Tuesday and Wednesday nights about his questioning at the CBI headquarters. He is said to have told the chief minister that the government should not defend him as he would himself be handling the probe agency.

During his questioning, the CBI had asked Mr Kumar whether he had had promoted Endeavour Systems from 2007 onwards by misusing his official position and facilitated tenders worth Rs 9.5 crore to the firm. The officer reportedly told the CBI that neither he nor any of his relatives was a director, shareholder or even employee of the company. He said that the amount of the order was in fact a matter of record.

On a specific question whether Sandeep Kumar, one of the directors of the firm, was a relative of Ashok Kumar, who earlier worked under him, Mr Kumar said both were in no way related to him nor they were distantly known to him till they came into contact with each other while working together in the education department.

Asked whether a MIS project of Delhi Transco Ltd was given to Endeavour Systems and a payment of Rs 40,61,465 was made by ICSIL to Endeavour from February 2010 to March 2011 and he himself had initiated the proposal as he was posted as chairman of the Delhi Transco Ltd. When A.K. Duggal was the MD of the ICSIL, Mr Kumar said that he had on behalf of the DTL asked for manpower from the ICSIL. He said he had never asked for a particular company from where ICSIL could source human resources. Mr Kumar is said to have told the CBI that the ICSIL was also given service charge for arranging the manpower for working on projects of DTL.

“It is to be understood that ICSIL is a company jointly owned by Govt. of Delhi and TCIL, a public sector undertaking of the Govt. of India. Central or state government-owned PSUs are routinely awarded work orders by the concerned client departments of the state or Central government due to lack of requisite technical resources and expertise in the concerned client departments. The ICSIL is paid a service charge in lieu of the services and due diligence done by it. The ICSIL neither comes under DTL nor is ICSIL MD answerable to DTL in any manner. Therefore, there is no question of any influence being exercised by DTL on ICSIL. The ICSIL must have chosen the vendor based on some parameters as tendering of qualified manpower is not possible. Engineering, management and law graduates with three years of professional experience command salaries ranging from Rs 8,000 to Rs 8 lakh per month or even more depending on their individual skills and performance parameters despite having the same educational qualification.”

The CBI also grilled Mr Kumar about a project related to manpower for the health and family welfare department. He was asked whether the project was given to Endeavour by ICSIL in 2010 without calling any tender or quotation. The agency asked him whether vide his email on October 20, 2010 he had sent an attachment to the ICSIL MD wherein salaries were quoted against individual posts. The quotation provided by M/s Endeavour to MD ICSIL subsequently were exactly same salary mentioned therein for individual posts, even qualifications and work column similar to the said email of Mr Kumar. The said email of Mr Kumar had also mentioned that he would also send a formal request after informally knowing the final costing part.

Mr Kumar is said to have told the CBI that the same may have been prepared by the department at that point of time to give a particular salary and that would have been indicated in his email. The officer said: “The ICSIL might have asked companies, including Endeavour, to work on that salary and that must have been acceded to. Again, health department does not have any administrative control over the ICSIL and hence there was no case of influencing anyone.”

The CBI reportedly asked whether Ramesh Chugh, state programme officer of the Delhi State Health Mission, vide his letter dated November 10, 2010 had requested the ICSIL MD to provide manpower for an e-project. The agency also asked whether the rates so quoted by the Endeavour were communicated by ICSIL to Mr Chugh, who in turn communicated to the ICSIL through a letter on December 1, 2010 that the competent authority has approved the rates provided by the ICSIL. In all, an amount of Rs 2,43,81,594 had been paid by the ICSIL to Endeavour. At that time, Mr Kumar was the health secretary and A.K. Duggal was the MD of the ICSIL.

The senior IAS officer told the agency that the Delhi State Health Mission does not recognise Endeavour. He said: “It only recognises ICSIL. Any rate communicated by ICSIL would naturally and normally be agreed upon by the Delhi State Health Mission unless it has in-house expertise in this matter. Again, there is no question of influence as ICSIL does not come under Delhi State Health Mission, directly or indirectly. The amount is a matter of record.”

Information revealed that the work order for project related to enterprise resource planning for the Delhi Jal Board was given by ICSIL to Endeavour through an open bid. Criteria was such that Endeavour could only participate. In retendering, only two companies had participated. Tenders were reportedly opened on August 25, 2014. The MGRM tender was rejected on technical scrutiny. And work order of Rs 2,47,55,155 was given to Endeavour at the initial stage. At that time, Mr Kumar was the secretary to the CM and R.S. Kaushik was MD of ICSIL.

Denying these charges, Mr Kumar said there were hundreds, if not thousands, of companies inside India who would be eligible to qualify the tender criteria. “In fact, it is not possible to draft a tender condition that would include a small company like Endeavour and excludes everyone else. Besides, NSDL, a PSU conducted a study of the software requirements for the department, and estimated the software cost to be Rs 20 crore, whereas, the work was awarded for Rs 2.456 crore only, almost one-tenth the estimated cost. “I have never worked in DJB and therefore there is no question of me influencing its procurement decisions. The work was awarded during the President’s Rule, so there was no question of anybody being a secretary to CM as no CM existed as on August 25, 2014 when the tenders were opened. This was in contrast with the earlier order for software development and implementation awarded to TCS for more than Rs 50 crore, much in excess of the estimates, against which nobody has yet raised a question.”

On the request of the Delhi government’s trade and taxes department, the ICSIL had issued open tenders for the project of system development and implementation. Endeavour is said to have submitted the last bid. The time was extended and two more companies gave their bids. But tender was given to Endeavour and Mr Kumar is said to have approved the proposal of ICSIL to award the tender on October 15, 2012 and very next day, he was released from the charge of commissioner, trade and taxes. On December 5, 2012, additional commissioner (trade and taxes) had pointed out several discrepancies. The development work for the website was for Rs 2,33,00,000 whereas the maintenance charges were given at the rate of Rs 1,33,00,000 per annum. At that time, G.K. Nanda was the MD of the ICSIL.

Denying these charges, Mr Kumar said an open tender was floated. He said: “The work did not pertain to a development of a website, but was for the ERP implementation. The two are poles apart... As Endeavour was the only bidder, timing was extended, which was the right thing to do... After extension of time, three parties participated and Endeavour became the L-1. I approved the ICSIL proposal on selecting the L-1 and that was the right thing to do. Next day I was released from the department. The department might have raised some questions, and it is sure, that they would have been answered satisfactorily, otherwise, the new commissioner would not have awarded the work. Though I approved the L-1, but I did not actually award the work order, which was done by the new commissioner.”

“The implementation cost of Rs 2.33 crore was way below the amount of money estimated and sanctioned by the Government of India under mission mode project of NEGP. A lot of money was returned to the Govt as it was saved (national e-governance programme). Some other state governments have paid this much money only for conducting the requirement study and floating of RFP to consultants. Normally, a state would spend multiple times the money in implementing the same. There is nothing unusual about maintenance cost of a service being around 50 per cent or more than the development cost of a software. More so, if 10 persons are required to be deployed routinely and regularly. In this contract, maintenance also included implementing all the changes required by the department. In fact, the entire software had been written at least four times since it was first deployed. Any knowledgeable person in IT would know that any big company would, first of all not agree to unlimited changes after deployment, and even if it agrees, the cost would be multiple times the original cost.”

The CBI is said to have told the officer about the project of facility management system of trade and taxes department in which four bidders had responded to the tenders. ICSIL MD G.K. Nanda had scrapped the tender on flimsy ground as Endeavour was not the L-1 bidder. Thereafter, tender was awarded to Endeavour Systems without floating tender, by R.S. Kaushik. And an amount of Rs 45,50,493 was paid to the company.

Mr Kumar said he had no role in this as he was not in the trade and taxes department during the period of allegation. “Although the facility management ought to have been given to Endeavour, as the maintenance work is supposed to be given to the OEM (original equipment manufacturer) as per the GFR, which in this case was Endeavour because the original software was developed by Endeavour Systems.”