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Saturday, August 6, 2011

CAG slams Air India for Rs. 200 crore loss!

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Kashish Gupta, Updated: August 05, 2011 22:34 IST.

New Delhi:  There seems to be more trouble for the government from its auditor. The Comptroller and Auditor General's (CAG) report on Air India has slammed the airline's management for a lack of foresight and said the decision to buy new aircraft caused a loss of Rs. 200 crore.

The report says the expansion plans of the national carrier were not based on due diligence, and that the new aircraft should have been bought in two phases. 

Air India has rejected the CAG's contention that 'defective contracts' led to losses, saying the new aircraft were intended to meet increased demand. The government also says all decisions to buy aircraft were cleared by an Empowered Group of Ministers (EGOM).  

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