The Travel and Dearness Allowance, also known as TA/DA, fell under scrutiny in 1996 when it was discovered that some high ranking council members were abusing the allowance, It's known today as the TA/DA Scam and is one of the biggest scams in India.
Travel and Dearness Allowances
Travel allowance refers to money that is paid to employees for travel and other expenses when they are doing business tours. This would include hotel, meal, and ticket expenses. Dearness allowances are allotted to employees and pensioners in the public and government sectors and are a cost of living allowance.
The scandal took place in India's Karnataka state during the Siddaramaiah administration. Eight LMC (Member of Legislative Council) of the Karnataka Legislative Council had been submitting phony bills to claim the TA/DA allowances. It was N. Manjunath Prasad, the then BBMP commissioner, who exposed these members and the scam. There were two main cases being investigated.
In one case, it is believed that the TA/DA scam cost $54,000 dollars (37 Lakh Rupees) for the state exchequer. Those involved in the scandal were R.B Thimmapur, who later became excise minister, G. Raghu Achar, C.R. Manohar, Allum Veerabhadrappa, S. Ravi, M. D. Lakshminarayana, N. S. Boseraju, and N. Appaji Gowda.
Another case, against Tariq Hanif Joiya, who was a district police officer in the Rahim Yar Khan district, saw as much as Rs 11.3 million being embezzled. It was confirmed, in a second fresh inquiry team set up by the home secretary, that many bogus travel and daily allowance requests had been made and paid.
It seems that there have been ongoing instances of fraud with TA/DA made by government employees, some of which are high profile. It led to Indian Railways' passenger reservation data being seized by the ministry of finance in an attempt to get the fraud under control. It was discovered that forged or bogus rail tickets were being submitted with TA claims.
Another audit report from AK Saxena, the Additional Controller General of Defence Accounts, discovered that there were 3,500 TADA claims that had been made by IAF personnel, which included 400 officers who ranked as high as Air Commodore, had been faked. The estimated amount of this fraud over a period of 5 years amounted to about Rs 350 crore (over $51,100,000). As a result, the auditor has recommended that strict actions be taken against these high-ranking officers that would affect their chances of promotion.
Many of the travel tickets had forged the signatures of the civil aviation ministry's undersecretary to bypass having to get the mandatory approval from the ministry when flying on any airline other than Air India. Other officers had tried to digitally alter the ticket amounts in order for them to show higher fares. It was also found that hotel bills had been grossly inflated, and it was suspected by the auditors that this scam may be a well-organized case of racketeering given how widely spread the forgery had taken place and the amount of personnel that was involved across all military branches. The methods used were consistent across all cases, as was information technology being used.
The modus operandi for this scam was to enable those involved to make money by cheating the system. The scandalous aspect is how many high ranking politicians and military personnel were involved in the scam.