Probe into Rs 60-crore bill irregularities flags FD mismanagement causing Rs 6-7 crore loss to PCMC

Pune: An inquiry into alleged irregularities within the accounts department of the Pimpri Chinchwad Municipal Corporation (PCMC) has uncovered significant financial mismanagement. The probe revealed that civic officials cleared bills worth Rs60 crore without mandatory approvals from the standing committee or general body, and caused losses of approximately Rs6–7 crore through improper fixed deposit (FD) investment decisions.

The inquiry report, submitted to the mayor on Tuesday and accessed by TOI, stated that funds from 10 FDs were left idle for up to 45 days after maturity instead of being immediately reinvested, resulting in a substantial loss of interest revenue. While the funds were eventually placed in four FDs across various nationalised banks, the delays ranged from 13 to 45 days.

The committee also found that the civic body frequently chose banks offering lower interest rates despite better options being available. In one documented instance, the PCMC invested Rs574 crore with the Bank of Maharashtra at an interest rate of 7.86% for one year in 2025. This decision was made despite Canara Bank offering 7.99% for the same tenure — a move that cost the municipal corporation approximately Rs22.96 lakh in lost interest.

The report further highlighted procedural lapses, alleging that at least one nationalised bank was intentionally excluded from submitting an interest rate offer.

Abhishek Barne, the standing committee chairman who initially demanded the probe, has sought a full recovery of the losses from chief accounts officer Pravin Jain. Jain was sent on compulsory leave shortly after the investigation began. Barne alleged that these discrepancies were more than mere administrative errors.

“The probe confirms that certain banks were given preferential treatment. Chief accounts officer and finance director Pravin Jain is responsible for these actions, which have caused significant revenue losses to the corporation,” Barne told reporters. He added that he would formally move to have the lost revenue recovered directly from Jain.

The inquiry examined FDs totalling Rs1,810 crore during 2024, noting a consistent failure to reinvest funds promptly. Further, it observed that investments exceeding Rs4,000 crore were placed in lower-interest accounts despite more competitive offers.

The PCMC administration has forwarded the report to the state govt, recommending disciplinary action against Jain. Because Jain is a state-appointed employee, the municipal corporation lacks the independent authority to penalise him directly.

The controversy began in April when Barne alleged large-scale irregularities regarding the clearance of civic work bills on a single day (March 30). While the subsequent investigation found no specific irregularities in bill clearances over the last three years, it blew the lid off the mismanagement of the civic body’s vast FD portfolio.

The municipal commissioner confirmed in a general body meeting earlier this month that the final report has been submitted to the state for appropriate action.