CAG raps Odisha mines department for royalty short levy

Rs 1,686 cr under recovery during 2006-11

Mining revenue may be the single biggest contributor to Odisha’s non-tax revenue base, but the mining department has drawn flak from the Comptroller & Auditor General of India (CAG) for below par recovery.

In its latest report on the state's revenue sector for the year ended March 31 last year, the Central auditor pointed out that during 2006-11, there was short levy or non-realization of royalty, dead rent and surface rent with a revenue implication of Rs 1,685.72 crore in 1,297 cases.

Of these, the state mining department accepted audit observations in 759 cases involving Rs 918.08 crore, but recovered only Rs 9.72 crore in 164 cases.

The average recovery of only 1.06 per cent, as compared to acceptance of objections, was very low and it ranged between 0.01 per cent and 28.34 per cent, the CAG report said.

In 2011-12, records of 19 units relating to mining receipts were test checked by audit. It found non/short-demand of royalty, dead rent/surface rent, non/short recovery of interest and irregularities of miscellaneous nature involving Rs 1,299.33 crore in 306 cases.

Against this,the mines department accepted under assessment and other deficiencies involving mining receipts of Rs 1,114. 24 crore in 159 cases pointed out by audit during 2011-12. An amount of Rs 2.57 crore was recovered in 62 cases during 2011-12.

According to the CAG report, arrears of mining receipts stood at Rs 1,844.92 crore (as on March 31, 2012). This included Rs 9.31 crore outstanding for more than five years, Rs 1,334.68 crore under dispute, Rs 1.62 crore locked up in litigation, Rs 1.46 crore under certificate proceedings, Rs 2.34 crore under write-off proposals and the remaining Rs 504.82 crore being recoverable.

The Central auditor has urged the mines department to revamp its revenue recovery mechanism to ensure that it can recover at least the amount involved in the accepted cases.