Municipal Corporation of Delhi audit report flags financial losses and irregularities of ₹312.5 crore

The audit process in the MCD has been pending over the past two years due to non-formation of the standing committee

New Delhi

The MCD Civic Centre. (HT Archive)

The municipal audit report for the 2022-23 fiscal, which was tabled in the standing committee meeting on Wednesday, flagged estimated losses to the tune of ₹312.5 crore to the civic body due to financial irregularities or non-realisation of revenue.

The audit process in the MCD has been pending over the past two years due to non-formation of the standing committee amid political and legal tussle; a series of audits will be assessed by the 18-member panel. The 2022-23 audit report covers the first period after the unification of the three corporations in May 2022.

The audit report contains 77 audit paragraphs covering seven departments of the corporation with an overall money value of ₹312.5 crore, chief auditor Varsha Tiwari stated in the report. “Major cases include non realisation of revenue due to poor implementation of solid waste management byelaws ₹155.12 crore, non realisation of revenue share as per Outdoor advertisement policy ₹122.39 crores,” the report states.

Despite the notification of the Solid Waste Management Rules, 2016, by the urban development department, user charges were not imposed for door-to-door collection of waste, according to officials.

“The erstwhile South Delhi Municipal Corporation implemented the norms which stated that the civic body will collect, transport, and dispose of the garbage from waste generators and levy a user fee... Irregularities were found in the collection of charges from commercial units in the south zone. It, together, caused an estimated loss of ₹84.9 crore,” the report states.

In the case of the central zone also, despite the notification of by-laws more than four years ago, the DEMS department failed to recover a minimum user fee amounting to ₹70.23 crore from waste generators, it adds in another audit paragraph.

The second major audit paragraph pertaining to the advertisement department states that on realisation of revenue share as per outdoor advertisement policy of 2017 resulted in short collection of ₹122.4 crore. The report has highlighted a “short realisation of revenue share amounting to ₹81.97 crore on account of the display of advertisements at IGI airport and short revenue receipt of ₹40.42 crore from a transport company on account of the display of advertisements at bus queue shelters”.

The report adds that short or non-deposition of floor area ratio, conversion and one time parking charges led to revenue losses of around ₹9 crore, loss of revenue due to delayed uploading of revised licence fee structure was around ₹3 crore and it also flagged non-recovery of ₹3.37 crore from Delhi government on account of providing house-keeping and sanitation services during Covid-19 period for a facility.

Officials said that non or short deposition of property tax and interest due to delay in pursuance led to losses worth ₹2.9 crore. Auditors have also flagged cases where payments to contractors were made without receipt of delivery challans ( ₹3 crore), and without quality assurance ( ₹1.64 crore)

An MCD official said that these are only findings of the auditors and the reports will be finalised after seeking comments by the standing committee.