Jammu: The Comptroller and Auditor General
has criticised the J&K government for systemic deficiencies
that resulted in under-recovery of Rs 1,211 crore worth of tax
money due to inadequate planning and non-compliance with the
extant procedures and rules.
"The arrears as on March 31, 2009, in respect of some
principal heads of revenue as by the department (Finance
Department) was Rs 1,211.70 crore," the CAG Report for the
year ended March 31, 2010, revealed here.
Ticking off the state government, the report further said
out of the total arrears, Rs 650.52 crore was outstanding for
more than five years.
The CAG report, which was tabled in the J&K Assembly
recently, said out of the total tax arrears, Rs 1,153.66 crore
was outstanding against businessmen, traders and various other
organisations on account of sales tax and VAT.
Similarly, Rs 4.77 crore was outstanding arrears on
account of state excise taxes, Rs 28.06 crore as passenger
tax, Rs 24.25 as toll tax, Rs 0.21 crore as entertainment tax
and Rs 0.75 crore as motor spirit tax, it said.
The CAG, in its 2010 report, expressed surprise over the
observation of the government that specific action in respect
of the remaining arrears of Rs 657.88 crore in the Sales Tax
sector had not been initiated by the Finance Department as of
Of the total Rs 735.07 crore worth of sales tax arrears
on March 31, 2009, the recovery of Rs 76.78 crore was stayed
by the courts/appellate authority, the CAG report said.
The CAG report further said that tax collection was not
smooth and suffered deficiencies liked inadequate planning,
non-reorganisation of the administrative machinery, shortage
of staff and non-computerisation.
There were systemic deficiencies that affected the
efficiency and effectiveness of the assessment and collection
of toll tax, it said, adding there was very poor internal
control and it was not satisfactory.
The CAG recommended a speedy recovery drive and direction
to Jammu and Kashmir Bank for timely remittance of revenue
into the government account. In case of delays, the CAG
called for charging interest from the bank in lieu of the late
It also recommended monitoring and identification of
dealers and business houses that have failed to pay their
taxes and cancel their registration in case of their failure
to pay the arrears.