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DMK’s Pannaiyar PTR Runs Away When TOI Journo Questions Him Over CAG Finding: ₹1,127 Crore Central Funds Diverted To PD Accounts

By
The Commune
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Former Tamil Nadu Finance Minister and DMK’s pannaiyar Palanivel Thiaga Rajan (PTR) launched a series of attacks on a Times of India journalist Omjasvin after being questioned about alleged financial irregularities during the previous DMK regime, repeatedly accusing the journalist of lacking competence and understanding of government functioning.

But as the exchange continued, the journalist placed a specific finding from the Comptroller and Auditor General (CAG) audit before PTR, including an observation that the Tamil Nadu Government diverted ₹1,127 crore of Centre’s share to Personal Deposit accounts on eight occasions between July and October 2021, during PTR’s tenure as Finance Minister.

PTR did not directly answer that question.

The exchange began after PTR took a swipe at the TVK government following widespread videos of Tamil Nadu Chief Minister C. Joseph Vijay flagging off a racing event in the UK.

Responding to media coverage of Vijay flagging off the Michelin Le Mans Cup race at Silverstone, PTR wrote, “No better sign of the times than media houses from Chennai to Delhi climbing all over each other to hype this “race” in rural England, while Tamil Nadu suffers rampant crime and ubiquitous power cuts… The people get the government, and the parasitic media, they deserve…”

Times of India journalist Omjasvin responded by turning the spotlight towards financial decisions taken during the DMK government in which PTR served as Finance Minister between May 2021 and May 2023.

Omjasvin wrote, “. @ptrmadurai makes sweeping comments about media, calls journalists including me dumb. It was during DMK time where at least Rs 5000 crores worth projects were tendered out without a financial sanction in @chennaicorp
and @chennai_Highway. @ptrmadurai served as the finance minister during 2021 May to 2023 May.

As a former finance minister, I hope he can answer to the people on how govt departments executed these projects without a financial sanction from the state finance department? Can projects be tendered out without placing them in grants and getting administration and financial sanction?

@chennaicorp has released an offiical statement saying at least Rs 1900 crore worth projects were executed without a financial sanction, which means, they were tendered out without the concurrence of finance department. They have said another Rs 1500 crore worth projects are there which have been tendered that way, and this raises the overall outstanding dues to Rs 3500. Dues for financially unapproved projects.

Recently Greater Chennai Contractors Association has released a newspaper ad stating the they have a massive outstanding due which haven’t been paid to them.

Adding more on this, highways minister Aadhav Arjuna further had moved a resolution in assembly stating Rs 2000 crore worth projects were tendered without financial sanction and keeping them in demands for grants.

Does this amount to a major financial mismanagement? Illegality? Causing loss to exchequer and does it raise questions on whether the projects were tendered out just for kickbacks? As contractors themselves have come out in open now that they’ve not been paid, who will answer them? I hope you can clarify this to people.”

PTR responded by saying he was prepared to defend his record on the files he processed as a minister, while distancing himself from the Chennai Corporation’s decisions.

He wrote, “Since I am tagged here, let me set a few things straight:

I am happy to defend my personal record as a Minister on any of the ~7,500 files I processed as Finance & HRM Minister between ’21 – ’23, or the ~100 I processed as IT Minister between ’23 and ’26
I cannot be held accountable for the actions of others beyond my control, particularly
@chennaicorp
which you ought to know is a different LEVEL of government (local body), and NOT in the control of the State Finance Ministry
No reasonable person would argue that everything was done right by one government, or that nothing is being done right by another government. I am a reasonable person, and hence I will not make such arguments
I had great hope that the new Government would use the unique luxury of a clean slate to undertake the profound reforms that are essential if we are to improve as a state, and to bring their vision of a corruption-free model to life – starting with gathering a slate of national & multi-national experts around them to make up for their inexperience
I am increasingly disappointed, in fact alarmed, at the looming administrative failure that I see developing – largely as a function of inadequate application of mind and infusion of expertise (which can still be rectified, in my opinion). The focus on image-management has to give way to a focus on actual administration/governance or our future is bleak
The failure of the press – acting as cheerleaders and fan media, instead of holding the government to account on administration/governance – is of deep disappointment to me. Many of the Chennai/TN press that held previous governments to account have now turned into fan pages. Do your job, with self-respect. The Govt has enough cheerleaders and can manage without you
The Noida (Godi) media, which is an unashamed agent/bootlicker of the Union regime and hence beneath contempt, has started to bring the same parasitic tendencies to TN politics. The injection of this Noida virus is deeply distressing.

I hope my position is clearer now”

But Omjasvin pointed out that the issue was not limited to the Chennai Corporation and specifically cited State Highways projects.

He replied, “Sir, even for local bodies, projects above Rs 10 crore, TN govt is the authority to give sanction. And I’ve also mentioned state highways which executed Rs 2000 crore worth projects. Even for that, TN govt didn’t give any accord.”

He also shared the relevant government orders setting out the administrative-sanction powers for municipal corporations.

The rules cited show that, for capital works in municipal corporations other than Chennai, projects fully or partly funded from municipal funds above ₹10 crore and up to ₹100 crore require sanction from the Director, while projects above ₹100 crore require Government sanction, subject to the prescribed process.

For maintenance works fully or predominantly funded by the Government, estimates above ₹5 crore require Government sanction.

PTR responded saying, “In what way was I derelict in my duty? Why are you raising this with me? No one else to tag? Does Government mean Finance Minister? And was this even when I was Finance Minister? If you’re incapable, or unwilling, to hold the current government to account, don’t try to fake competence by pretending to have “discovered” some discrepancy on my part. It only amplifies your ignorance. And I don’t have any more time to waste on your need to prove your competence…”

The exchange then moved to the Chennai Smart City audit.

Omjasvin replied by saying, “Whatever I had attached including those in my original posts are self explanatory, sir. It simply asked how govt executed Rs 5000 crore worth projects in the previous regime without a financial sanction for most projects which definitely the finance department only has to give. Second was the CAG report on smart city released last week which clearly mentioned the dates stating how central funds were diverted to personal accounts of multiple state dept in violation to norms from July to Oct 2021 violating the union finance ministry norms. It is not fake competence to ask about financial mismanagement of previous govt placed in open domain by various stakeholders. When you openly target journalists and call media people names, questions can be asked both ways. I’ve anyway written critical stories of the present regime too, and you have retweeted/liked some of them. Looks like you have forgotten about them too soon. Have a good day sir!”

PTR responded saying, “FYI…I personally requested the Smart City Audit…..and started an initiative that recovered over 12,000 crores from PD Accounts. I am amazed at your logic of questioning the Finance Minister/Ministry for the violations of others. It’s like accusing the shop owner for the damage done by vandals. If you have the courage, question the violators, not the one who tried to fix the system…”

Omjasvin cited the CAG report, which records that the High-Powered Project Sanctioning Committee (HPPSC) for Smart City projects was constituted with the Additional Chief Secretary to Government, Finance Department, as its chairman.

According to the CAG report, the committee was created to consider appraisal reports, finalise the means of finance, including loans and grants, and accord administrative sanction for proposals exceeding the prescribed financial limits.

Between 2016 and 2023, the HPPSC held 14 meetings in which 86 proposals involving projects worth ₹6,037.80 crore were submitted by 11 smart cities. The committee approved 70 projects amounting to ₹3,877.50 crore, while reducing proposed costs by ₹1,010.78 crore. Five other projects received approval with an additional cost of ₹9.95 crore.

More importantly, the CAG found that cities had split proposals into multiple projects or packages to keep their estimated value below the financial threshold that required higher-level sanction.

The audit also found that 12 projects involving ₹590.58 crore, despite individually exceeding the prescribed sanctioning limit, were not submitted to the HPPSC. Instead, they were taken up with the approval of the respective sanctioning authorities or urban local bodies.

The committee, as recorded by the CAG, was chaired by the Additional Chief Secretary to Government, Finance Department, with the Principal Secretary to Government, Municipal Administration and Water Supply Department, as a member and the Managing Director of TUFIDCO as Member Secretary.

PTR then sought to turn the CAG discussion back on Omjasvin, arguing that the Finance Minister could not be held responsible for the actions of committees of which he was not a member.

He wrote, “Is it that you don’t understand how to read Audit reports, or that you are trying to fool people to think you’re some kind of smart reporter?

What does this report say?

The Committee was created in 2016. What it doesn’t explicitly say, and you’re not competent enough to understand, is that this was a necessary fix to overcome the problem of Union-direct-to-local-body-grant model. There is much to be debated here on the violations of federalism, and we made those points when we were in opposition itself from 2016 on. I don’t know what you were doing then, but clearly you weren’t paying attention to such issues.
The committee, like many many such committees, was composed ENTIRELY OF IAS OFFICERS, WITHOUT EITHER THE DEPARTMENT MINISTER OR FINANCE MINISTER as members. Again, there are a lot of problems with such an approach, in my opinion – and it is not in keeping with Democracy. But those issues also are clearly above your level of understanding. The point at your level is….no Minister was ever part of this committee.
Just as a quick check of your basic understanding of Government functioning…..how many such committees do you think there are? I bet you cannot estimate within a 50% margin of error. And how often do they meet? Who gets to even see the minutes of such meetings? Try to learn some basics…
There is no mechanism for a Minister to be aware of, let alone be responsible for, the actions of any committee whose proceedings he is not a part of. Even a 10-year old can understand that, I think, But clearly you cannot.
And what does this audit paragraph actually say? It says that CITIES VIOLATED both the INTENT of the guidelines (by splitting projects to avoid the 2016-determined threshold), and the GUIDELINES themselves by NOT submitting proposals above the threshold to the committee for prior approval.
Since you don’t seem to understand the basics of Auditing, let me break it down for you. That charge will have to be answered at the Public Accounts Committee (consisting of MLAs), by the CITIES involved, and possibly the supervisory function at the DMA. NOT by the members of the empowered committee, who were bypassed. You cannot hold the committee responsible for non-submission by Cities. If the PAC decides to take action for the offenses, it will have to act on City/DMA officials. Not any member of the committee, and certainly not on the Finance Secretary.
I’m not sure how long you have been doing this, but you clearly have very poor understanding of how to interpret Audit findings. Or how committees work. Or how information is circulated/processed in the government. In fact about a lot of things related to administration and governance.
You are a well-intentioned novice at these issues, at best. That is not a sin. But pretending to be much more competent than you are, is definitely misleading/outright lying.
As an opposition MLA, I wrote to the concerned Union Minister Thiru Gadkari, asking for a comprehensive Audit because there were MANY MORE violations of the scheme than the issues pointed out in this Audit report. Go and try to find them if you can.

A little knowledge, combined with unwarranted belief in your alleged “expertise” is a dangerous combination.”

Omjasvin, however, did not back down.

He returned to what he said was the specific issue contained in the CAG report — the diversion of Central funds during PTR’s tenure as Finance Minister.

He wrote, “This part of the CAG report is easy for any laymen to understand and it doesn’t require expertise to read it. My question to you again sir: CAG report places key irregularities during your term (July 2021 and Oct 2021) specifically stating the state govt diverted funds to its personal accounts of its state depts EIGHT TIMES instead of routing it through a nodal agency in violation to union finance ministry rules. What did the high power committee, headed by the finance secretary, do? How did they allow this? What was the reason for the funds to be diverted? Were you aware of this during your tenure as finance minister sir as it happened during July 2021 to Oct 2021?”

The CAG finding cited by Omjasvin is more specific than the earlier discussion over project sanctioning.

According to the audit, a March 23, 2021 letter from the Union Government required the State Government to designate a Single Nodal Agency and open a Single Nodal Account for implementing each Centrally Sponsored Scheme. The guidelines also stipulated that the Central share should not be diverted to a Personal Deposit account or any other account by the State Government.

The CAG audit found that, on eight occasions, the Tamil Nadu Government diverted the Centre’s share through Government Orders between July 2021 and October 2021 to Personal Deposit accounts, in violation of the Ministry of Finance guidelines.

The amount involved was ₹1,127 crore.

The same section of the audit also recorded that five cities had earned ₹239.40 crore in interest. Of this, only ₹149.01 crore was apportioned into the Consolidated Fund of India and Consolidated Fund of the State — ₹62.09 crore and ₹86.92 crore respectively.

The audit consequently found short remittances of ₹57.61 crore to the Consolidated Fund of India and ₹32.78 crore to the Consolidated Fund of the State.

PTR did not provide a response to those specific questions in the exchange.

That leaves a striking contrast in the public exchange. PTR began by accusing the media of acting as “cheerleaders and fan media” and demanded that journalists hold governments to account. But when a journalist repeatedly sought an explanation from a former Finance Minister over a CAG-documented financial irregularity that occurred during his tenure, PTR’s responses focused largely on the journalist’s alleged lack of expertise, the distinction between State and local government, and his own role in seeking audits and recovering funds.

The unanswered issue remains the CAG’s finding that ₹1,127 crore of Central funds were diverted to Personal Deposit accounts on eight occasions between July and October 2021, during the period when PTR was Tamil Nadu’s Finance Minister.

Whether PTR was personally aware of those transactions, what role the Finance Department played, and why the diversions took place were the precise questions put to him. But he has not responded to any of those.

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