Audit report reveals Rs 73.84 crore illegality in BBMP revenue department

Bengaluru: The Bruhat Bengaluru Mahanagara Palike (BBMP) revenue department officials along with the property owners defrauded worth crores of money, the fraud was revealed by the audit report. 73.84 crore rupees from this department alone in the financial management of the year 2019-20. Irregularity has been detected.

Property tax is the main source of income for the corporation. The officers and staff working in the revenue department are taking bribes from the property owners and causing a loss of crores of rupees to the corporation. Although the bribery of these officials is exposed in the annual audit, the Palike is not able to curb these practices.

Even from leased assets, rent is not being collected adequately. Due to this, the corporation’s income is being lost. Tax arrears are not being adequately collected from Community welfare halls, PG hostels, cinemas, mobile towers. The series of irregularities including fixing tax for less area for buildings, levying residential building tax for commercial building, issuing account illegally, registering account without paying the improvement cost continues.

In 2007, the commissioner had issued a circular to levy a recovery cost of Rs 250 per sq m for assets converted to non-agricultural use in newly incorporated areas and Rs 200 per sq m in old wards.

However, from 2007-08 to 2019-20, the account was registered by owners of land converted properties without payment or partial payment of improvement cost. In this regard, the authorities have not submitted the verified DCB transaction of demand, recovery and balance details for verification. Rs 9.04 crores due as per the computerized list of pending improvement cost details in cases registered by 19 sub-divisional offices. The auditor suggested that this amount should be recovered.

The audit report revealed that while deciding the tax for residential and non-residential buildings according to the area of the buildings, many assistant revenue officers did not check the location of the buildings, wrong zone classification, low tax calculation, wrong valuation of properties and tax was fixed for low area and looted Rs 1.27 crore.

According to the Municipal Corporation Act, the corporation has to collect 2% of the stamp duty on the registered document in account transfer of properties. However, some Assistant Revenue Officers have not collected this fee. Still others charge less than the fixed fee.

Although the Commissioner has ordered to charge an account transfer fee of 2 percent, 44 Assistant Revenue Officers have collected less than Rs 24.78 lakh in account transfer fee during the year 2019-20. The auditor recommended that this amount should be recovered from the authorities concerned.

An account of 65.32 acres of land has been registered in the name of L&T Construction Equipment Limited in Byatarayanpura village. A map has been approved for the construction of a residential complex here and the Commencement Certificate (CC) was issued for the building on June 9, 2017. Later, possession certificate was obtained on 21st August 2019 for 783 flats with an area of 211596.15 sq m constructed in Block 1 R-Tower 1 to 11 and Block R-2 Tower 14, 15. These 783 flats have been divided into primary accounts and registered under municipal sub-accounts.

In this case, the SBA area of 783 flats is 1395072 sq. ft. and 121806 sq. ft. of car parking, a total 1516874 sq. ft. is taxed. The remaining 759896.57 sq. ft. has not been taxed. As a result, the corporation incurred a loss of Rs 34.73 lakh.

Assistant Revenue Officers have to assess the tax from the date of issue of possession certificate for the buildings. However, many authorities have fixed the tax from the next date instead of the date issued by the OC. Due to non-fixation of tax from the date of issue of OC or the date of expiry of building construction permits, lakhs of revenue has been lost to the corporation. Some Assistant Revenue Officers along with builders and building owners looted Rs 31.26 lakhs in the year 2019-20.