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Crores lost in revenue collection

- Audit finds anomalies in tower & ad agency fees

Financial anomalies seemed to have hit cash-strapped Patna Municipal Corporation hard in the past couple of years.

The civic body is estimated to have suffered revenue losses to the tune of around Rs 1 crore due to a decision taken by the empowered standing committee headed by mayor Afzal Imam on January 27, 2012, for lowering taxes against outdoor advertisement space on government property.

An ongoing audit by the finance and accounts office in Patna Municipal Corporation (PMC) has revealed that no revenue was collected against installation and operation of cellphone towers in the city over the past two financial years (2011-12 and 2012-13). The civic body also does not have any records on installation of new cellphone towers and collection on renewal of licences for the existing ones during the same period.

Considering the registration charges of Rs 50,000 and annual renewal fee of Rs 15,000 per tower, the audit team has suspected pending payments amounting to Rs 4,21,40,000 against the cellphone towers across the city.

The audit team has also raised its reservations on withdrawal of Rs 3.51 lakh in the 2012-13 financial year for gifting briefcases to ward councillors without any provision for the same in the PMC budget or any public utility use of such payment.

Regarding the anomalies in advertisement tax rates, a senior PMC official said: “The standing committee in January 2012 had approved charging advertisement tax at private property rates on hoardings put on government or municipal corporations’ property as well. However, as per a decision taken by the standing committee on September 29, 2007, the rates for advertisement space on government property was fixed at Rs 80 per square feet and that for private property was Rs 12 per square feet. The decision to charge private property rates (Rs 12) for putting hoardings even on government property (original rate was Rs 80) led to windfall gains for a few big outdoor advertisement agencies operational in the city.”

PMC commissioner Kuldip Narayan, through a letter (dated January 6), has quashed the change in advertisement tax rates and ordered collection of respective revenue as per the 2007 order only. “A report on the matter has also been sent to the state urban development and housing department to seek guidelines for further action,” a PMC official said.

About the queries raised by the audit team on lack of records and pending payments against mobile towers, the official said: “The matter related to collection of taxes from telecom firms against cellphone towers is sub-judice at the level of Supreme Court and Patna High Court for over last two years. Due to this reason, taxes have not been collected against the towers over the past two financial years.”

Advertisement agencies apart, the elected representatives at the civic body also seem to have benefited because of the financial anomalies. As per Section 75 of the Bihar Municipal Act, 2007, payment of funds should not be made under any head unless it is approved by the budget of the ongoing year.

“The audit team, through its letter (dated January 9), has stated that payment of Rs 3,51,000 for purchasing briefcase has neither been done as per any budget provision nor it related to any public utility work. The payment was purely for the personal gains of the ward councillors,” the PMC official said.