‘Civic body charging low octroi rates on 96 items for over 4 years’

A report by the civic administration’s audit department has revealed that the BMC’s octroi department has been charging lower octroi rates on nearly 96 articles for the past four years,resulted in loss of revenue.

Written by Express News Service | Mumbai | Published: April 4, 2012 1:03:50 am

A report by the civic administration’s audit department has revealed that the BMC’s octroi department has been charging lower octroi rates on nearly 96 articles for the past four years,resulted in loss of revenue.

The report by the then Municipal Chief Auditor dated August 6,2011 revealed irregularities in the collection of octroi rates by the Assessor and Collector Department from 2007.

The audit has observed that in case of nearly 96 articles,wrong or lower rates were declared without sanction of the state government. Audit has pointed out short recovery of octroi on account of application of wrong or lower rates.

Instead of taking necessary steps to effect short recovery as pointed out by Audit department,the tax department took an adamant stand that it will accept the new revised schedule,resulting in loss of revenue for BMC.

The report,which was brought to light by a local MNS corporator Sandeep Deshpande,states that ‘the existing Octroi Schedule H and H-1 was revised just to maintain the uniformity in the description of Article’,and not to ‘change the existing rates of octroi of any article’ as was done with effect from May 1,2007.

This means that the tax department has tweaked the law and charged lower octroi for goods,which were not exempt from the lower octroi rates,he explained.

“It is surprising to see that the entire goof-up went unnoticed in front of the Standing Committee and no action was taken in the space of five years.” he said.

Another such report from the Auditor’s department also exposes reduction of octroi rates from 2 per cent to 0.01 per cent on Diamonds,Pearls and other semi-precious stones,applicable only in case of parties availing Export Promotion License,wrongly extended to other importers resulting in the recurring loss of revenue.

However,a senior civic official from the Octroi department said,“It was wrong on part of the Auditor to mention it in the report. Absolute approvals were taken from the State Government on the entire proposal and moreover,reduction on the octroi rates cannot be sanctioned to any single party.”

The report,though clearly mentions that,nearly 96 articles had lower rates and were without the sanction of the State Government and despite several objections on the part of the Audit committee,no action had been taken.

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