Assam leaking revenue with loopholes galore

CAG report lays bare Dispur’s tardiness as thousands of crores go abegging

BY OUR STAFF REPORTER

GUWAHATI, April 18: The amount of revenue collected by the Assam government is much less compared to other States of the country. This tardiness can be attributed to many loopholes that are yet to be plugged by Dispur. The State therefore continues to lose revenue to the tune of crores of rupees every year.

The Comptroller and Auditor General (CAG), in its report, has highlighted the factors affecting revenue collection in the State.

The report stated that problems in the areas of non/short levy of taxes, royalty, fees, rent, interest, pelty, irregular exemption and other irregularities are mainly hampering tax collection in Assam.

“3,216 paragraphs involving revenue implication of Rs 6,991.7 crore remained unsettled at the end of June 2014 as replies were not furnished by senior officials. During the year 2013-14, only three audit committee meetings in respect of Revenue, State Excise and Transport Departments were held, in which 347 paragraphs were settled,” the CAG report stated, adding, “Permits were issued to the contractors of tiol Hydro-electric Power Corporation for lifting minor minerals on realization of royalty at lower rates, resulting in short realization of royalty of Rs 22.89 crore.”

The CAG report further stated: “Due to non-verification of utilization statement of declaration forms/delivery notes/annual, monthly returns/audit reports, the assessing authorities could not detect concealment of purchase/sales turnover leading to short levy of tax of Rs 69.87 crore, including interest. Incorrect application of rate of tax resulted in short levy of tax of Rs 42.03 crore, including interest. In some of the above cases, the mis-classification occurred despite clear guidelines issued by the CT way back in 2007,” adding, “Short realization of royalty of Rs 40.06 crore due to non-detection of payment of royalty at lower rates by the Oil India Limited.”

Despite clear provisions in the Assam Value Added Tax Act to verify the correctness of Input Tax Credit (ITC) claimed while scrutinizing the returns, the Assessing Authorities could not detect irregular claim of ITC of Rs 15.05 crore, the CAG report stated.

According to the report, despite an industrial unit representing that the processes undertaken by it did not amount to ‘manufacture’, the department did not initiate action to cancel the authorization certificate granted to the unit. Consequently, there was undue benefit/remission of tax of Rs 55.79 crore including interest. Besides, pelty of Rs 69.32 crore was also leviable.