Compliance Performance

Report No.3 of 2018 - Revenue Sector Government of Kerala

Date on which Report Tabled:
Tue 12 Jun, 2018
Date of sending the report to Government:
Government Type:
Sector Finance


The Report features a Performance Audit, four Compliance Audits and 23 individual paragraphs with a revenue impact  of ` 426.98 crore and expenditure impact of     ` 7.43 crore.

Performance Audit on ‘Infrastructure facilities in the Commercial Taxes Department’ revealed non-adherence of action plan relating to e-governance activities and improper maintenance of IT assets. Department neither formulated an integrated and comprehensive plan nor adopted guidelines for implementation of the modernisation of offices.

CA on ‘Enforcement under KVAT Act’ revealed that  ineffective mechanism to trace unregistered dealers led to 412 dealers remaining out of the tax net, resulting in non-levy of tax of ` 35.25 crore. As per the data gathered from Central Excise and Customs, 27 dealers imported cashew worth ` 1,967.83 crore against which only ` 729.44 crore was disclosed in their returns, which was not verified by the Department. CA on ‘Permits, Taxes on Transport Vehicles and Enforcement under Motor Vehicles Act’ revealed that validity of permit of 14,127 motor vehicles expired during 2014-15 to 2016-17. Penalty collectable on these vehicles was ` 3.32 crore. The rate of tax of contract carriages that were registered in other States and operating in the State of Kerala was enhanced for the period from 1 April 2014 to 17 July 2016. The differential tax amounting to ` 81.08 crore from 1 April 2014 to 17 July 2016 was not collected from  86,080 such contract carriages. CA on ‘Collection of building tax in Land Revenue Department’ revealed that 450 buildings were not reported by village officers for assessment to building tax resulting in non-levy of building tax of ` 9.47 crore. Similarly, non assessment by Tahsildars in respect of 2,742 buildings reported by Village officers resulted in non-levy of building tax of ` 10.23 crore. CA on ‘Conduct of Lotteries in the State of Kerala’ revealed that during 2011-12 to 2016-17, the Director of State Lotteries did not pay charges of  ` 3.81 crore to the Government as provided under the Lotteries (Regulation) Rules, 2010.

Besides the above, this Report features paragraphs on non/short-levy of VAT, short levy of Motor Vehicles Tax , unauthorized reconstitution of Board of Directors of companies/firms holding Foreign Liquor licenses etc.

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