Government auditor CAG today flayed Department of Fertiliser for delaying contract finalisation saying this has resulted in an unavoidable subsidy burden of Rs 5,555 crore. In its recent report tabled in Parliament today, CAG said, fixation of benchmark at a lower level in comparison to the then prevailing prices for determining Nutrient Based Subsidy, NBS rates for Di-Ammonium Phosphate, DAP resulted in delay in finalisation of contracts for import of DAP for 2011-12, which led to the unavoidable subsidy burden. The auditor also pointed that Department of Fertilisers imported additional quantity of fertilisers which was not required, resulting in undue subsidy payment of Rs 653 crore. It also said that there was no monitoring mechanism in Department of Fertiliser to ensure that the prices fixed by fertiliser companies were based on their cost of production and were reasonable. The report also raised concerns that Department of Fertiliser did not finalise guidelines for recovery from fertiliser companies using cheap domestic administered price mechanism gas for production even after the delay of more than two years after direction of EGoM in February 2012 in this regard. Meanwhile, CAG has recommended that Department of Fertiliser may factor in the impact in movement of international prices while fixing the benchmark price before start of financial year. It also suggested that as NBS policy gives freedom to companies to fix MRP,Department of Fertiliser may critically review that pricesare actually fixed by companies at the reasonable level.