CAG raps BDA for losing Rs 3,500 crore revenue

Bengaluru: The Bangalore Development Authority (BDA) lost Rs 3,500 crore by not collecting betterment tax, the Comptroller & Auditor General (CAG) found, slamming the body for “lackadaisical effort” and “poor financial management”.

The CAG’s compliance audit report for the year ended March 2022, tabled in the Assembly on Thursday, said BDA could collect betterment tax of Rs 3,307.91 crore at the Arkavathy Layout and Rs 195.72 crore from the Nada Prabhu Kempegowda Layout (NPKL).

The BDA had identified 2,262.15 acres from 1,699 landowners at the rate of Rs 3.65 lakh per gunta for betterment tax at the Arkavathy Layout. In NPKL, 610.02 acres belonging to 315 landowners at the rate of Rs 80,208 per gunta were identified. The government approved levy of betterment tax in February 2018.

“BDA could collect (up to March 2022) only Rs 3.22 crore out of Rs 3,503.63 crore betterment tax...despite having legal authority and necessary approval from the government,” the CAG said. In 2019 and 2020, the BDA ended up paying Rs 34.66 crore interest out outstanding loans, which was “avoidable had the BDA made earnest efforts to realise potential revenue sources such as betterment tax”, the audit said.

The CAG also flagged irregularities in the allotment of sites under the BDA’s incentive scheme, leading to “undue benefits” of Rs 10.54 crore to landowners.

Disparity in temple grants

The audit found that private temples received more grants than state-run shrines indicating the absence of "systematic and equitable" fund allotment. Between 2017-18 and 2021-22, a total of 2,856 religious institutions received grants. Only 592 of them were Muzrai temples. Muzrai temples got Rs 44.48 crore against Rs 187.81 crore to private ones, the report said.

Undetected fraud

The CAG said that embezzlement of government receipts (fines, fees, duties etc) of Rs 2.27 crore through "fraudulent practices and manipulation of records" at the office of the Chief Judicial Magistrate, Bengaluru Rural, went undetected for over four years (June 2018 to November 2022) due to failure in following internal control procedures. A criminal case was registered against seven officials in this case.

15,000 high-rises weren't inspected

Authorities did not inspect and issue no-objection certificates (NOC) to 15,366 high-rise buildings out of 19,640 in seven cities of Karnataka, the CAG found. Also, non-issuance of NOCs and renewal of clearance certificates (CC) led to loss of revenue of Rs 165.24 crore, it said.