Kendrapara, July 16: Alleged bungling of urban development grants has snowballed into a simmering controversy with local municipality councillors stepping up demands for penal action against those responsible for money laundering.

Uproarious scenes were seen during the council meeting of Kendrapara Municipality on Friday with members up in arms against corrupt practices by the chairperson and civic body officials. Charges and counter-charges flew thick and fast as findings of bungling of urban grants by the special audit report took centrestage.

The council members alleged that civic body funds were being siphoned off keeping them in the dark. Funds released to the civic body both from the Centre and state were misused. A special audit squad has come across discrepancies and financial irregularities with regard to use of public utility project and urban development plan grants.

The audit team detected that Rs 4.39 crore spent during 2009-10 for development projects by the municipal body was replete with bending of rules, procedural norms and mandatory provisions for government civil construction projects.

While Opposition council members pressed for a probe and recovery of defalcated funds from those who perpetrated the corrupt practices, the Nationalist Congress Party (NCP) on Friday in a memorandum to district collector stepped up demand for in inquiry by vigilance wing of state police.

“The audit has uncovered corrupt deeds. Those who laundered public money should be taken to task,” said Manindra Kumar Rout, Kendrapara town wing chief of NCP.

“Misappropriation of urban funds has now become crystal clear. We have been raising protest against the corrupt practices by those at the helm of urban local body. The misused funds should be recovered and penal action be initiated against those who were found guilty by the special audit report,” said Hizbur Rehman, a councillor.

The audit detected the mode of expenditure as flawed and suggested the recovery of nearly Rs 24 lakh from the civic body authorities who had executed the projects, according to official sources.

“In the past, council members had voiced their protest against the alleged lapses and irregularities. The council members from time to time had vehemently opposed the autocratic style of functioning of chairperson, Roshana Sahu and her alleged patronage to corrupt practices. But their protest did not yield any result as the ‘tainted’ chairperson enjoyed covert patronage of a heavyweight leader of ruling BJD,” alleged Sarat Beura, a Congress councillor.

Kendrapara Municipality chairperson, Roshana Sahu said: “The works executed by the municipality have been done in accordance with norms and spirit of rules. We have submitted a compliance report to the state government with regard to objections raised by the special audit report.”