New Delhi: The National Highways Authority of India (NHAI) does not maintain project-wise records of borrowing costs worth ₹ 1.44 lakh crore, making it impossible for auditors to verify how much was charged to completed highway projects, the Comptroller and Auditor General (CAG) said in a report tabled in Parliament last week.
It noted that the deviation had been repeatedly flagged but remained unresolved. The audit also flagged several other financial planning and accounting lapses, including NHAI’s failure to remit ₹ 4,152.54 crore earned as interest on unutilised capital to the government. NHAI earned ₹ 4,152.54 crore as interest on unutilised capital during 2023-24 but did not remit it to the Consolidated Fund of India, despite the requirement under Rule 230(8) of the General Financial Rules, 2017, the CAG said. The audit also raised questions over NHAI’s accounting of ₹ 10.07 lakh crore of highways as its own assets during 2023-24, as well as the treatment of maintenance expenditure and interest earned on unutilised government funds. NHAI spent ₹ 5,812.21 crore on routine highway maintenance in 2023-24, against ₹ 1,174.07 crore released as a grant by the ministry of road transport and highways and ₹ 128.99 crore received from other sources. Instead of recording the resulting ₹ 4,509.15 crore as expenditure through the profit and loss account, NHAI adjusted it against its shareholder’s fund, the report said. This resulted in both excess expenditure over income and the shareholder’s fund being understated by ₹ 4,509.15 crore, the CAG said. NHAI capitalised ₹ 25,900.33 crore in borrowing costs during 2023-24, taking the cumulative amount capitalised to ₹ 1,44,446 crore as of March 31, 2024.
The cumulative amount shown as “interest on unutilised capital” stood at ₹ 27,350.33 crore. The CAG said interest from earlier years also needed to be reconciled and remitted. The CAG said this was despite “Accounting Standard 16” requiring such capitalisation to stop once a project is ready for use. The borrowing costs were included in NHAI’s disputed balance-sheet head of “Assets held on behalf of GoI (completed & ongoing)”, valued at ₹ 10,07,532.92 crore. The CAG said the accounting treatment does not conform to the approved accounting format or generally accepted accounting principles, noting that national highways belong to the government and NHAI is only an executing agency.
