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CAG raps ministries for year-end spending spree

business Updated: Apr 26, 2012 01:28 IST
Rajesh Ramachandran
Rajesh Ramachandran
Hindustan Times
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Like the rush to buy gold on Akshaya Tritiya or utensils on Dhanteras, the indolent ministries of textiles and heavy industries wait for March 31 to spend the largest chunk of their budgetary allocation.

The comptroller and auditor general (CAG), in its latest report on the Union government’s finances tabled in Parliament on Tuesday, has found that these two ministries spent 63% and 60% of the annual expenditure on the last day of the fiscal year.

“The government should examine the reasons of lumping of expenditure, particularly in the case of investments, other charges, advertising and publicity, minor works, major works and machinery and equipment, at the fag end of the financial year,” the report said.

Against explicit orders issued by the finance ministry in 2007, most of the ministries have spent 22% of their total annual expenditure in March last year and 24% of their plan expenditure in the same month.

The CAG has also pulled up the Central Board of Direct Taxes (CBDT) for breaching constitutional provisions. CBDT collects excess taxes every year and pays out a hefty amount as interest without any parliamentary sanction. In the past five years, the department has paid out Rs. 37,365 crore in just interest, with the amount going up to R10,499 in 2010-11.

The audit report notes: “The Constitution stipulates that no money shall be withdrawn from the Consolidated Fund of India, except under appropriation by law.
Interest payment on refund of excess tax is a charge on the Consolidated Fund of India.”

In 10 years, the amount has gone up by 114 times from Rs. 92 crore in 2001-02. Now, the revenue department refuses to address the issue, labelling the process of refunds as “of highly variable nature leading to inaccuracies in estimation”.