CAG Criticizes BDA's Fiscal Mismanagement Over Betterment Tax Collection

The Comptroller and Auditor General (CAG) of India criticized the Bangalore Development Authority (BDA) for poor financial management, highlighting a loss of Rs 3,500 crore in potential revenue from betterment tax. The CAG's audit report revealed significant discrepancies in the collection efforts, contrary to the prescribed procedures.

The Comptroller and Auditor General (CAG) has slammed the Bangalore Development Authority (BDA) over its 'lackadaisical effort' in generating internal revenue through legally enforceable means, spotlighting a staggering Rs 3,500 crore loss due to uncollected betterment tax.

The CAG's compliance audit report for the Department and Public Sector Undertakings, covering the fiscal year ending March 2022, was tabled in the Karnataka Assembly on Thursday. It revealed that BDA managed to collect merely Rs 3.22 crore out of a projected Rs 3,503.63 crore betterment tax from Arkavathy and Nada Prabhu Kempegowda Layouts between April 2019 and March 2022.

The audit highlighted that the BDA failed to adhere to procedural requirements outlined in the Act to collect the betterment tax, which exacerbated its financial woes. The report also noted that BDA incurred Rs 34.66 crore in interest on outstanding loans over 2019-20 and 2020-21, costs that could have been avoided with better fiscal management.

Additionally, the audit pointed to disparities in the distribution of grants to religious institutions, observing that out of total grants distributed to 2,856 religious institutions in selected districts from 2017-18 to 2021-22, only a small fraction were government-run Muzrai temples, which received substantially less funding compared to private temples.

(With inputs from agencies.)