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A recent audit by the Comptroller and Auditor General (CAG) highlighted significant lapses in the Yamuna Expressway Industrial Development Authority's (YEIDA) housing project management between 2005 and 2021. The report revealed policy and procedural irregularities, inadequate eligibility criteria, and financial mismanagement leading to stalled projects and financial losses exceeding INR 4,200 crore. Irregular allotments, weak financial safeguards, and delayed project timelines were common issues. YEIDA has since acknowledged deficiencies and implemented changes to tighten its allotment process, including stricter financial requirements, enhanced penalties for delays, and improved project accountability measures.
The Yamuna Expressway Industrial Development Authority (YEIDA), responsible for developing the area surrounding the upcoming Noida International Airport, has faced severe criticism from the Comptroller and Auditor General (CAG) for lapses in its policies and operations. An audit spanning 16 years (2005-2021) exposed significant procedural irregularities that have contributed to one of the largest clusters of stalled projects in the country, involving YEIDA, Noida, and Greater Noida. Advertisement
Among the issues raised, CAG highlighted irregularities in residential township and group housing allotments, which resulted in financial losses amounting to INR 4,226 crore. The eligibility criteria for these allotments were found grossly inadequate, allowing bidders with minimal financial capacity to secure high-value plots. In one instance, developers obtained plots valued at up to 18 times their declared net worth.
Between 2010 and 2011, YEIDA allotted 14 residential township plots ranging from 2.5 lakh square metres to 8 lakh square metres under three schemes. However, mismanagement led to cancellations, delays, and surrendering of 16 plots. These delays resulted in dues of INR 4,185 crore by late 2022. Similarly, five group housing plots allotted between 2011 and 2014 also saw project delays, with three cancellations and one partial surrender.
Specific cases cited by CAG include Greenbay Infrastructure, which secured a plot worth INR 192 crore despite limited construction capability, leading to dues of INR 703 crore. Another example involved Orris Developers, whose lead consortium member failed to meet eligibility criteria yet secured a plot valued at INR 388 crore, accruing dues of INR 989 crore.
The audit also criticised YEIDA for lax oversight, citing leniency towards defaulting allottees. Penalties for delays were deemed insufficient, and allotments were not cancelled despite repeated violations, such as tampered documents submitted by Supertech Township Project Ltd. Other irregularities included allowing premature exits of consortium members, which disrupted project accountability and delivery.
The report pointed out the absence of critical safeguards in YEIDA's scheme brochures, such as escrow accounts, performance bank guarantees, and restrictions on leveraging solvency credentials for multiple allotments. It also flagged YEIDA's practice of granting conditional mortgage permissions without proper provisions, leaving the authority financially exposed.
CAG recommended a series of reforms, including revising eligibility criteria to align with the size and value of plots, introducing financial safeguards, and strengthening accountability mechanisms for consortiums. It also suggested vigilance inquiries to identify deliberate favouritism and hold responsible individuals accountable.
In response, YEIDA acknowledged the shortcomings and committed to corrective measures. It defended its initial practices as reflective of market conditions and its nascent status but conceded the need for stricter policies. Recent changes include requiring developers to deposit 40% of the plot premium upfront, prohibiting plot subdivision, and mandating project completion before consortium members can exit. The authority also promised to incorporate robust penalties and financial safeguards in future schemes.
The CAG audit of YEIDA's operations sheds light on systemic failures that have undermined housing project development and financial sustainability. These lapses not only delayed timely housing delivery but also resulted in substantial financial losses. While YEIDA has taken steps to tighten its processes, the onus remains on the authority to rebuild trust and ensure accountability. The reforms being implemented have the potential to address past shortcomings, but sustained oversight and stricter enforcement will be critical in restoring confidence among stakeholders.
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