Cag Raps Centre For Revenue Shortfall

The report of the Comptroller and Auditor General of India (CAG) on customs receipts has disclosed that there was a revenue loss of Rs 1,422.43 crore during 2000-01 on account of non-levy or short levy of customs duty. It also revealed that the cost of collection as a percentage of customs receipts had gone up to 1.22 in 2000-01 from 0.99 in the previous year.

The report, which was tabled in Parliament today, said that customs collections fell short of the budget estimates in 2000-01 by 11 per cent or Rs 6,030 crore. Pointing out that the collections in the previous four years too were lower than the budget estimates, the shortfall being in the 4 per cent-24 per cent range, it said those were indicative of the weaknesses in the budget forecasting.

It further said that customs duty of Rs 21,658 crore or 46 per cent of the total customs receipts, was forgone during the year on account of the various export promotion and duty drawback schemes. In the previous year, it was 38 per cent or Rs 18,166 crore of the total customs receipts of Rs 48,338 crore.

The duty forgone in 2000-01 under the advance licence scheme was the highest at Rs 5,311 crore while that under DEPB and duty drawback schemes were Rs 4,631 crore and Rs 4,308 crore, respectively.

In a review of non-realisation of foreign exchange, the CAG said that export proceeds aggregating Rs 11,735 crore were pending realisation as on June 2000. Of this, almost two-third or Rs 7,549 crore was outstanding for over two years.

The report said that almost 25 per cent or Rs 2,929 crore has been outstanding for over 5 years. The United States of America topped the list of countries from where forex was outstanding. Almost 16 per cent or Rs 1,845 crore was outstanding from the USA, the report said.

According to the report, the efficacy of export outstanding statements (XOS) as a control instrument for monitoring export incentives was limited due a delay in their transmission to the customs houses by the Reserve Bank of India, poor follow up action at the customs houses, and inadequate information.

The CAG also came down heavily on the poor planning and inadequate resource allocation which had caused a considerable delay in implementation of the Indian customs electronic data interchange system (ICES).

It said no major gains in trade facilitation were visible since EDI connectivity was not established and only a very small percentage of consignments were being cleared within the three days stipulated in the Citizen