KTDFC collected excess interest from KSRTC

he Comptroller and Auditor-General (CAG) audit has found that the KTDFC has charged `122.04 crore excess interest from the Kerala State Road Transport Corporation (KSRTC) for loans availed of by the latter. The CAG report asked the KSRTC to take up the matter with the KTDFC for reimbursement. The report says that the KTDFC is authorised by the government to collect only 0.5 percent more than its cost of funds.

The KTDFC calcutes its cost of funds every financial year based on the funds raised by it through bank borrowings, bonds and public deposits. However, the audit found that excessive rates were charged from the KSRTC during the period of inspection.

The excess amount paid by the corporation during 2009-10, 2010-11, and 2011-12, according to the report, is `16.44 crore, `47.42 crore and `58.18 crore respectively. ‘’Even though the criteria for fixing the rate of interest on loans is ‘Cost of funds of KTDFC’, the term has not been defined in the relevant loan agreements,’’ says the report. The lack of transparency in determining the rate of interest resulted in the loss to the KSRTC. The report asked KSRTC to get reimbursement and to ensure that in future interest is charged as per the govt orders.

Source: Express News Service