The Public Accounts Committee (PAC) of Parliament on Monday urged the Telecom and Revenue Secretaries to speed up the action of collecting long pending and hushed up dues of more than Rs 30,000 crore from private telecom operators, as exposed by CAG.
PAC chairman KV Thomas directed that the Revenue Secretary should monitor the collection of the huge dues and the Telecom Secretary should speed up the collection besides implementing a fool proof mechanism for it.
Revenue Secretary Hasmukh Adhia and Telecom Secretary JS Deepak deposed before the PAC, which examined the CAG report on under-invoicing of Rs 46,000 crore worth of revenue by six telecom companies. The CAG in its report said due to this under-invoicing of revenue during 2006 to 2010, the public exchequer lost more than Rs 12,500 crore and as per penalties on tax evasion this amount would be more than Rs 25,000 crore currently.
TRAI chairman RS Sharma also deposed before the parliamentary panel. Cutting across party lines, MPs blamed the Telecom Department for ordering a Special Audit after the CAG findings. The MPs observed that based on the CAG audit, the DoT can straightaway issue notice to the six telecom operators for evading revenue share to Government and tax dues. The six operators indicted by CAG for under invoicing and
tax evasion are Airtel, Vodafone, Idea, Reliance Communications, Tata and Aircel.
The PAC had issued a detailed questionnaire to Telecom and Revenue Secretaries on the speedy collection procedures on the huge dues found by the CAG. The officers were asked to answer within 14 days and the next PAC would expected to finalise the recommendations to the Government.
The MPs pointed out that the Telecom Department’s move to conduct Special Audit has opened an avenue for the errant operators to approach the courts again to get stays on dues collection. It is learned that Thomas had directed the Telecom Secretary to conduct legal cases, if any filed by the private operators. He said DoT should take the matter seriously and field best legal experts to challenge the designs of private mobile phone companies.
The MPs also blamed Finance Ministry for “sitting as mute spectator” even after CAG exposed big tax evasion of more than Rs 30,000 crores. They said the CAG audit exposed only during the period of 2006 to 2010 and the revenue sharing system came into force from 1999. Thomas also directed the Revenue Secretary to monitor the tax evasion from 1999 and ensure the prompt collection of the huge dues, which is already collected from public.
PAC urged the DoT and TRAI to evolve a transparent mechanism to collect the revenue share from the private telecom operators. 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.