Faulty estimation leads to huge funds surrender by Bihar: CAG | patna | Hindustan Times
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Faulty estimation leads to huge funds surrender by Bihar: CAG

CAG report points to improper budget estimation in Bihar.

patna Updated: Mar 28, 2017 10:49 IST
Anil Kumar
CAG report was released in Patna on Monday.
CAG report was released in Patna on Monday. (Santosh Kumar / HT photo)

The CAG report, tabled in the state assembly on Monday, has expressed its concern over the large savings of Rs 35,013 crore out of the total budget provision of Rs 1.48 lakh crore for 2015-16. It is a result of “improper budget estimation” and inability to utilise funds allocated for revenue expenditure, it said. 

Out of this, only Rs 24,456 crore (22%) has been surrendered but a sum Rs 10,557 crore (8%) of the total budget has been allowed to lapse in a state desperate for overcoming developmental deficit, the CAG report on financial management and budgetary control has pointed. 

“An amount of Rs 15,913 crore was surrendered on the last day of the financial year, there was 100% surrender of funds in 182 schemes,” said Dharmendra Kumar, AG (audit), addressing mdiapersons, while admitting that fiscal liabilities of the state increased from Rs 99,056 crore (2014-15) to Rs 1,16,578 crore on account of rise in internal debt. 

Points to ponder
  • Faulty budget estimation leads to lapse of 10,557 crore (8%) of total budget of Rs 1.48 lakh crore 
  • Slow fund utilisation causes Rs 24,456 crore (22%) to be surrendered impacting growth 
  • Exponential rise in vehicles, to 6.74 lakh as on March 2016, make Patna ‘most unhealthy’ city 
  • Rs 12,074 crore abstract contingent (AC) bills pending in absence of detailed contingency (DC) bills

The AG said that the audit findings in three major revenue generation areas, under motor vehicle tax, stamp duty and registration fee and collection of arrears in commercial taxes, have indicated that the cumulative financial implication on state revenues was around Rs 1,417 crore. “The department/government has accepted more than half of the objections raised,” he said. 

Random performance audit of levy and collection of motor vehicle tax has shown that 132 vehicles were registered at reduced sale value, in one case a Swift car being registered at a price of Rs 30,000 (less than that of a scooter). Another 52 vehicles were registered in other districts after the actual date of purchase on reduced sale amount and 19,447 vehicles were delivered without assigning temporary registration numbers leading to a revue loss of 30.90 crore. 

“While registration at reduced sale value has taken place in the absence of validation checks in registration module, some instances of tampering with the software have also come to light,” Kumar said, admitting that the test cases may be indicative of a deeper malaise. 

While the amount of unrealised revenue arrears of the department in 14 circles has increased from Rs 378 crore (April, 2011) to Rs 3,637 crore on March 31, 2016, registering an increase of 860%, the result of compliance audit for the commercial taxes department has been equally shocking. 

“Assessing authorities did not detect incorrect availing of entry tax deduction by Indian Oil Corporation, Barauni, towards scheduled goods manufactured or produced within local area and sold in state capital, resulting in a short levy of Rs 740 crore,” he said. 

“Due to lack of inter-departmental coordination, penalty of Rs 44.69 crore against work contractors for illegal procurement of mineral was not levied by 20 district mining officers in 33 works division during 2012-13 and 2014-14,” he said pointing “nine registering authorities have also been found to have granted uncalled for exemption of stamp duty of Rs 7.57 crore in 99 cases.” 

Referring to non-preparation of annual accounts by 31, out of the 34 working PSUs, Kumar said on account of the lapse, the state government is not aware to have a lowdown on the status of its investments in these. “The government should direct controlling departments to ask working as well as 40 non-working PSUs to prepare their annual accounts to know about its liabilities,” he said. 

The AG also said that the audit of general, social and economic sectors, including police modernisation, left a lot to be desired. While there was no institutional framework to check quality of midday meals, the piped drinking water — an important component of seven resolves — was yet to take off with the desired pace in the state that had the lowest availability at 6% against national average of 41% and 35% in West Bengal.