Excise From Oil Not Paid To Govt: Cag

An audit report on Central excise presented by the Comptroller and Auditor General of India before Parliament yesterday, says that four oil companies collected Rs 4,036.75 crore in excise duty, but failed to pay the amount to the government.

It also said there was a short levy and loss of revenue of about Rs 9,803 crore during 1998-99.

An appraisal of service tax highlighted that the government had ignored potential revenue of about Rs 142,612 crore from 1994-95 to 1998-99. The government managed to collect only 4 per cent of the potential amount, the report said.

"Collection from service sector constituted less than 0.3 per cent of the value added in the service sector and amounted to only 1.2 per cent of the tax revenue of the Union government," it added.

 

Of the total service tax of Rs 5,690 crore gathered during the period, about 75 per cent came from telephone and general insurance.

As a result of the exemption to sectors like goods transport and outdoor catering, the department had to forego Rs 342 crore per annum as revenue.

On the customs side, in a comprehensive audit of the Export Promotion Capital Goods Scheme, the report said the 2,932 licencees achieved 77 per cent of the total export obligation to be realised by April 1998.

As a result, Rs 247 crore worth of duty concession was rendered unproductive.

The report adds that Rs 15,492 crore or 40 per cent of customs duty was foregone on account of export promotion schemes.

According to the report, the commerce ministry extended blanket amnesty to all defaulting firms by extending the period of export obligation to March 2001 "even though the law ministry had observed that the action beyond the ambit of subordinate legislation".

The audit also found a case of ad hoc exemption given to a private company for import of capital goods to set up a petrochemical unit which was not covered by the parameters established by the government.

The report on customs receipts revealed an underassessment of tax which resulted in a revenue loss of about Rs 768.5 crore.

The net customs duties of Rs 38,278 crore was 20 per cent less than the budgetary estimate and 10 per cent short of the revised estimate.

"These variation are indicative of weakness in the budgetary forecasting of the government," the report said.