Irked over the Finance and Telecom Ministries’ slow pace, the Public Accounts Committee (PAC) has summoned the Telecom and Revenue Secretaries, and the TRAI Chairman on June 13 over the ‘inaction’ on the CAG report exposing the Rs 46,000-crore under-invoicing by private telecom operators.
The decision was taken by PAC in its meeting on Monday after several MPs cutting across party lines expressed unhappiness over the inaction by the Government to recover the huge amount belonging to the public exchequer.
The CAG had submitted the report in Parliament in March and the DoT instead of acting directly, ordered for a Special Audit. According to the CAG report, in between 2006 and 2010, the six telecom companies had under-invoiced more than Rs 46,000 crore in their revenue figures, resulting a tax loss of around Rs 12,500 crore. The six companies indicted by CAG for under invoicing and tax evasion are Airtel, Vodafone, Idea, Reliance Communications, Tata and Aircel.
The Parliament panel took action after hearing the presentation of the CAG officials. CAG’s tax loss figure Rs12,500 crore was based on the past dates and did not include the penalty for not paying and hushing up the tax. According to the presentation given by auditors, the current tax liability of the six telecom operators would reach around Rs 30,000 crore, considering the penalty and fine for delay in paying tax and concealing it. Several MP’s of the PAC opined that the DoT’s move to appoint a Special Audit is “just a farce” and the government would straightway impose fine notice on the telecom operators.
According to PAC members, the process of Special Audit would take another one or two years and this move would provide the telecom operators to approach courts again. The MPs also criticised the lethargy of Finance Ministry over such an expose of CAG on “huge tax evasion.” The MPs urged the PAC Chairman KV Thomas to summon Telecom Secretary JS Deepak and Hasmukh Adihia on June 13 to explain the “inaction.”
For the past five years all the telecom operators were challenging CAG’s move to audit the revenue of telecom companies. The CAG sensed under-invoicing during their audit in 2G scam and then CAG Vinod Rai ordered audit in 2010. At last in April 2014, Supreme Court rejected the objections of telecom operators, ratifying the Delhi High Court verdict.