Uttarakhand Govt Explains 'Misutilization' Of CAMPA Funds; Supreme Court Closes Issue Finding Deviations To Be 'Trivial'

Pursuant to Supreme Court's rap regarding misutilization of CAMPA (Compensatory Afforestation Fund Management and Planning Authority) funds, the Uttarakhand government explained today that majority of the subject expenses were directly or indirectly related to purposes permissible under the relevant Rules.

In the few instances where irregularities were found, the state government conveyed that departmental proceedings were initiated prior to the Supreme Court taking note of the issue and appropriate action is contemplated.

A bench of Justices BR Gavai and AG Masih heard the matter and decided to not go further into the issue, after hearing Solicitor General Tushar Mehta (for Uttarakhand government), who answered the challenge to Uttarakhand's utilization of CAMPA funds.

The order was dictated thus:

"Perusal of the affidavit (of Uttarakhand Chief Secretary) would reveal that the amounts spent were on activities which are directly or indirectly connected to forestation and/or preservation of the forests. The amount spent is about 1.8% of the total funds available for utilization in the CAMPA fund. Insofar as the delay in deposit of interest is concerned, the ld. SG submits that since the interest rates were not decided by the Central government, the state government could not deposit the same within stipulated period. It is submitted that as soon as the Central government notified the interest rates, the interest has been credited to CAMPA fund. In view of the averments, we do not propose to proceed any further. We find that deviations, if any, are trivial in nature. However, the state would ensure that hereinafter, no deviations are made. The state would also ensure timely deposit of the interest at an approximate rate which can be subsequently adjusted as and when the Central government notifies the rate of interest."

Earlier, taking note of a news report brought to its notice by Amicus Curiae K Parmeswar, as per which a report by the Comptroller and Auditor General of India (CAG) had revealed that Uttarakhand forest authorities diverted funds meant for compensatory afforestation to the purchase of iPhones, laptops, fridges and coolers; renovation of buildings; court cases, etc., the Court had called on the Chief Secretary of Uttarakhand to explain why said funds were utilized for inadmissible purposes.

At the outset of today's hearing, SG Mehta took the Court through the Chief Secretary's affidavit and informed that the alleged misutilization of CAMPA funds in the state was to the extent of 1.8% of the total funds (ie Rs.753 crores approx.). Conceding that that was no justification for the allegations, the SG addressed the expenditures incurred under various heads out of the CAMPA funds.

Insofar as expenditure on Harela festival (a Hindu festival celebrated in Uttarakhand), the SG submitted that the festival is one for afforestation and involved plantation of 7 lakh plants across the state. When he referred to the expenditure made out of the funds on small stationery items (like registers, etc.), Justice Gavai commented, "your state is that poor that it cannot provide amount for this stationery?" In response, the SG said that the expense was believed to be for forest purposes and was not something "devastating".

So far as the expenses on ration (in relation to Rajaji Tiger Reserve), the SG explained that the ration was procured for the purposes of dowsing forest fires and constituted a negligible sum. Under the head "furniture", he conveyed that expenses were required for patrolling cars, fire crew, anti-poaching camp, etc. As far as expenditure of Rs.66 lakhs on renovation work, the SG added that some forest offices were in dilapidated conditions and were as such renovated. He however conceded that some expenditure was carried out by officials for their personal furniture, in relation to which departmental action was underway.

Citing CAMPA Rules, the SG subsequently justified expenses on establishment of a nursery. "This is within the framework of the Rules", he said. Relying on the same Rules, he submitted that expenses on purchase and maintenance of electronic equipment used for communication and information technology, survey, mapping, forest fire control, or protection of forests and wildlife, are permissible. He conveyed that 18 Samsung phones of Rs.7000 each were purchased out of the funds, which could be seen as a necessity for smart patrolling and forest fire management purposes.

In this context however, it was also conceded that a desktop, 2 laptops and 1 iPhone (worth Rs.53000) were purchased out of CAMPA funds and action has been initiated against those responsible for the irregular use.

Insofar as expenditure on construction of Tiger Safari, the SG submitted that the activity was not per se illegal, but the expenses ought not to have been from CAMPA funds. On the allegation of delayed deposit of interest by the state, he explained that owing to the Covid-19 pandemic, the Central government had not notified the interest rate (between 2019-22), which precluded the state from doing the needful. After the interest rate was notified, the interest amount was duly deposited, he underlined.

Summarizing his submissions, the SG contended that there may have been an "error of judgment" on the part of the authorities, however, the purposes for which the subject funds were utilized were not completely alien to forestation. At this point, Justice Masih questioned the expenses out of CAMPA funds while commenting that there must be some contribution by the state as well. The judge, alongwith Justice Gavai, also suggested that the state can deposit interest amount on the basis of anticipated interest rate in future (subject to adjustments after finalization).

Amicus Parmeswar, on his part, highlighted that the principal amount and the interest amount in CAMPA funds are to be utilized for different purposes. However, there is severe non-utilization of interest component by states, which park the funds with RBI so they can borrow against it.

Ultimately, the bench passed its order finding that deviations in utilization of CAMPA funds by Uttarakhand, if any, were trivial in nature.

Before the proceedings concluded, however, Justice Gavai flagged to the SG certain requirements of the Centrally Empowered Committee (including staff support). The judge pointed out that there are only 4 members, 2 of whom are still living in hostels. In reply, the SG assured that he would address the issue.

Case Title: IN RE : T.N. GODAVARMAN THIRUMULPAD Versus UNION OF INDIA AND ORS., W.P.(C) No. 202/1995