CAG detects revenue loss of Rs. 692 crores

Bangalore Dec. 25. The Comptroller and Auditor-General of India has discovered a revenue loss of Rs. 692.97 crore to the State Government for 2000-01 in 2,062 cases.

The records inspected by the CAG included that of sales tax, excise, taxes on motor vehicles, agricultural income, land revenue, stamps and registration fees, entry tax, professions tax, taxes and duties on electricity, other taxes and duties on commodities and services, forest, mineral, and public works, among others.

During 2000-01, the departments concerned accepted under-assessments, non-levy, and short levy etc. of Rs. 92.34 crore in 999 cases of which 887 cases for Rs. 9.42 crore had been pointed out in the audit in previous years. The departments recovered Rs. 9.48 crore during the year itself.

Under sales tax, grant of incorrect exemptions and concessions resulted in non-levy or short levy of tax of Rs. 4.34 crore in 93 cases, turnover tax of Rs. 1.55 crore was not levied or levied short in 81 cases due to incorrect exemption of turnover and application of incorrect rate. Application of incorrect rate of tax resulted in short levy of tax of Rs. 2.15 crore in 98 cases, non-levy or short levy of surcharge and cess to Rs. 53 lakh in 39 cases, failure to forfeit excess tax collected resulted in non-realisation of revenue amounting to Rs. 3.33 crore in 48 cases and non-levy of penalty for delayed payment of tax amounted to Rs. 1.37 crore in 58 cases.

The Government suffered a loss of revenue of Rs.116.98 crore in five years between 1998-99 and 1999-2000 due to the absence of stipulation on the contractors to lift at least the minimum quantity of arrack to meet their rental liabilities for securing retail vending rights.

The report indicted the department for its failure to ascertain the presence of malt spirit in whisky resulting in short levy of excise and sales tax of Rs.1.65 crore during 1997-98 and 1999-2000. A loss of Rs. 6.26 crore caused to the Government on termination of leases for retail vend of liquors in two districts for 1999-2000 had not been recovered from the defaulting contractors.

A review on levy and collection of water rates in the Tunga, Bhadra, and Tungabhadra basins during 1995-96 to 1999-2000 brought out the failures of the Irrigation Department.

Despite the recommendations of the Planning Commission that the revenue from irrigation projects should at least cover the operation and maintenance costs and interest on capital, the actual revenue from utilised potential in the basins fell short of even the maintenance expenditure by Rs. 112.36 crore.

At the end of 1999-2000, dues from farmers towards water supplied for agricultural purposes amounting to Rs. 144.91 crore and from local bodies and industries towards domestic and commercial usage amounting to Rs.3.12 crore were pending realisation. Lack of coordination between the Irrigation and Revenue departments had led to non-booking and short booking by tahsildars of water rate demands of Rs. 44.27 crore computed by the Irrigation Department.

Maintenance cess of Rs. 29.44 lakh had not been levied or levied short by six tahsildars. Discrepancies in village records or individual khatas of landholders constituted a short accountal of demands for water rate and maintenance cess of Rs. 61.14 lakh and penal water rate of Rs. 47.94 lakh resulting in their non-realisation. A review on dues recoverable as arrears and land revenue during the five years have disclosed that the system of monitoring of recovery prescribed by the Government in August 1994 pursuant to an earlier audit finding was largely non-functional as the prescribed registers and records were either not maintained or contained many discrepancies in figures between those of the deputy commissioners and the taluks under them.

According to the Government, dues recoverable as arrears of land revenue amounting to Rs. 170.83 crore were outstanding as of March 31, 2000. The correctness of this figure was not ascertainable as the figures reported to the Government by four departments were short by Rs. 154.66 crore. Based on the stay granted by courts, 22 cases involving Rs. 39.57 crore had been removed from the demand, collection, and balance statements against the provisions of guidelines.

A total of Rs. 68.51 lakh relating to State excise had not been taken as demand in the statements by three tahsildars in three districts. Incorrect determination of consideration for levy of stamp duty and registration fees in respect of six lease deeds registered during 1997-98 and 1999-2000 resulted in short levy of Rs. 62.70 lakh.

Under the entry tax, non-levy or short levy of tax on entry of goods into local area resulted in non-realisation of Rs. 81.36 lakh in 48 cases.

Under the mineral receipts, non-levy of interest on arrears of mineral rights tax amounted to Rs. 36.84 crore. Non-levy of penalty for transport of building stones without permits resulted in loss of revenue of Rs. 38.58 crore in eight divisions test checked.

There was short recovery of royalty of Rs.77.44 lakh in 97 cases relating to five years in question. Incorrect adoption of quantity of limestone consumed for manufacture of cement resulted in less recovery of royalty of Rs. 26.57 lakh during the period. Non-disposal of seized granite blocks in 12 divisions resulted in non-realisation of not less than Rs. 4.54 crore.

In public works receipts, five buildings in three divisions were kept vacant or rents not recovered at prescribed rates resulting in loss of revenue or non-realisation of Rs. 2.54 crore.