CAG raps Odisha for high revenue arrears

Dues accumulated to Rs 10,865 cr by March 2014

The state government has drawn flak from the Comptroller & Auditor General of India (CAG) for revenue arrears that had accumulated to Rs 10,865.71 crore by the end of March 2014.

Out of the total piled up dues, Rs 2,356.34 crore was outstanding for more than five years, says a report of the CAG on revenue sector for the year ended March 2014.

Besides, disputes over Rs 952.26 crore arrears were pending with the departmental authorities and sufficient efforts were not made to dispose of the same, the central auditor stated in the report. Though certificate cases/tax recovery proceedings were initiated for recovery of Rs 785.45 crore, they were not finalised.

Arrears of value added tax (VAT), inclusive of Odisha Sales Tax (OST) and Central Sales Tax (CST) contributed Rs 6,834.29 crore to total arrears. Dues under other heads include entry tax (Rs 2,001.22 crore), taxes on vehicles (Rs 140.33 crore), state excise (Rs 35.67 crore) and mining (Rs 1,845.20 crore).

The total piled up dues includes the amount covered by showcause notices, cases stayed by Supreme Court and the Odisha High Court, amount stated by the departmental authorities, demands covered by the tax recovery proceedings and amount likely to be written off.

Audit test check of the records of 174 units relating to OST, VAT, goods and passengers tax, state excise, stamp duty & registration fee, motor vehicles tax and other non-tax receipts conducted during 2013-14 showed under assessment/short levy/loss of revenue aggregating to Rs 4,713.63 crore in 510,147 cases.

In 2013-14, the concerned departments accepted under assessment and other deficiencies of the order of Rs 2,379.41 crore involved in 398,229 cases pointed out by the audit and collected Rs 4.73 crore in 268 cases.

Similarly, test check of the records of 170 units under commercial tax, excise, revenue disaster management, transport and steel & mines done during 2013-14 showed irregular expenditure or payment amounting to Rs 20.15 crore in 806 cases.

The CAG has also pointed to the irregular availing of input tax credit (ITC) by dealers. Under Section 20 (3) of the Odisha Value Added Tax Act, ITC is allowed to dealers on purchases made within the state from registered dealers holding a valid certificate of registration. ITC of Rs 2,247.38 crore availed by 26,511 dealers under the Odisha Value Added Tax Act, 2004 remained unverified due to non-scrutiny or ineffective scrutiny of returns, the report said.