December24: The accumulated losses of the Orissa Forest Development Corporation now stand at Rs. 108.26 crore, which had eroded the paid-up capital of Rs. 1.28 crore by over 84 times.
According to the Comptroller and Auditor General's report for 2003, the OFDC failed to encourage and establish industries based on forest products which is one of its main objectives and also failed to achieve any of its ancillary objectives during 40 years of its existence.
The main reasons for the huge losses as analysed by the audit are:

• Huge establishment expenses due to retention of surplus manpower.
• Continuance of sale centres outside the state.
• Decrease in value of sales due to delay in disposal of perishable goods like bamboo, Sal seed and kendu leaves.
• Huge shortage of stock.

The forest department delivers with effect from November 1996 dead, dry and wind-fallen trees to the company on payment of royalty at varying rates. The OFDC transports the same to its depots after longing as "round timber" and firewood. In depots, specieswise lots are made, "upset prices" of the lots fixed and are sold through auction' tender

The CAG report has revealed that OFDC sustained losses of Rs. 39.89 crore during 1997-2002 which was attributed to the company to surplus manpower and reduction of activities.

It was observed that due to non-transportation of timber/firewood from the forest to depots in time by the divisional managers of four zones of the company, 11,109 cum of round timber and 7723 MT of firewood received from the forest department during 1997-2002 were left in the forest. It was declared by the company as shortages.

Inaction of the DMs to transport the delivered stock in time resulted in loss of Rs. 2.20 crore towards payment of royalty for the above stock besides the loss of revenue of Rs. 8.33 crore at the average sales prices. The company transports the timber and firewood received from forest to its depots for sale. It was observed that depots were showing less receipt on many occasions and excess receipts on a few. During 1997-2000, the net short receipt at the depots was 5763 cum of timber valued at Rs. 5.04 crore and 8,111 MT of firewood valued at Rs. 89.50 lakh.

Timber despatched from forest to depots in entered in depot stock registers maintained at the depot level. Physical verification of stock is conducted annually by the officers nominated by the company. Physical verification reports during 1997-2002 revealed shortages of 2,031 cum of round timber and 15,893 MT of firewood valued at Rs. 3.41 crores.