The Public Accounts Committee (PAC) meeting scheduled on Monday will take up the CAG report on under-invoicing of Rs46,000 crore by private telecom companies. The PAC move is expected to put the Department of Telecom (DoT) in a fix, since it has not yet acted against the telecom companies to recover the money.
The CAG had submitted the report in Parliament in March. The DoT, instead of acting directly, ordered for a Special Audit. According to the CAG report, between 2006 and 2010, six telecom companies had under-invoiced more than Rs46,000 crore in their revenue figures, resulting a tax loss of around Rs12,500 crore. The six companies are Airtel, Vodafone, Idea, Reliance Communications, Tata and Aircel.
The 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 auditors, if penalty under Income Tax Act were invoked, the figures would expected to cross Rs25,000 crore.
In the last meeting of the PAC, several Parliamentarians blamed the DoT’s lacklustre attitude of not acting on the CAG report, which exposed the huge loss to the exchequer.
The MPs cutting across the party line, had pointed out that DoT’s move to announce a Special Audit to verify the CAG report’s findings creates doubt. “There is no need of Special Audit. CAG already conducted audit and exposed the under-invoicing and tax loss. The DoT should have straight away issued notice to these six operators.
“This Special Audit will take another one or two years and would provide escape routes to telecom operators and provide them door for further litigation. We will question this move of the Government,” MPs in the PAC said. The panel headed by KV Thomas MP will summon Telecom Secretary and if needed, call the private operators also, said MPs. In Monday’s meeting the PAC will hear the presentation of CAG officials about the findings in the report, tabled in Parliament during Budget Session.
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.