No diversion of GST cess: Govt after CAG report

NEW DELHI: The federal government has brushed aside tips of diverting GST repayment cess into its books and stated that the cash was once quickly mendacity within the Consolidated Fund of India, pending reconciliation. In its newest document, the Comptroller and Auditor Common of India had stated that throughout 2017-18 and 201819, there was once “brief crediting” of repayment cess of round Rs 47,000 crore, which led to over-statement of the Centre’s earnings receipts and understatement of fiscal deficit.
The finance ministry selected to reply to political complaint from Kerala finance minister Thomas Isaac, who had alleged “diversion” of budget. Denying the fee, a executive supply stated: “…in any way was once the repayment because of the states for the yr 2017-18 and 201819 have been totally paid and the time taken in reconciliation of repayment receipts can’t be termed as diversion of GST Cess Fund when the dues have been totally launched by way of the central executive.”

Finance ministry officers stated the repayment receipt within the CFI was once topic to reconciliation within the coming months within the next monetary yr. “If because of this the quantity remained within the Consolidated Fund of India, how can that be handled as ‘diversion’? Even the CAG in its document has now not stated so,” a supply stated. Officers stated consistent with the Constitutional provi sions, receipts — together with taxes and cess — accrued by way of the Centre want to be first credited into CFI sooner than being transferred to some other fund thru the cheap head. In case of the GST repayment cess, officers stated because the ultimate accounts are recognized best after the top of the monetary yr, normally round June-end, the surplus quantity quickly remains in CFI.
“After reconciliation, the quantity is transferred to Reimbursement Fund and from that Fund to states as in keeping with their repayment formulation,” a supply stated. All the way through 2017-18, Rs 62,611 crore was once accrued as repayment cess and Rs 41,146 crore was once paid to states. In 2018-19, in opposition to collections of Rs 95,081 crore, Rs 69,275 crore was once paid. Whilst Rs 47,271 crore did stay unutilised for reconciliation after fee of all of the dues, the cash has been used up therefore. “Subsequently, it may possibly’t be stated that this Rs 47,721 crore was once diverted for different makes use of,” stated a supply.