From Our Special Correspondent
Daijiworld Media Network - Bangalore 

Bangalore, Dec 7: Implementation 'Gram Swaraj,' Karnataka Government’s project for strengthening Panchayat Raj institutions in the State, was deficient, according to a report of the Comptroller and Auditor General (CAG) of India.

The CAG, in its reports tabled in the Karnataka Assembly, said the State government released grants to gram panchayats without ensuring achievement of the envisaged performance indicators.

There was no material improvement in collection of taxes and in the response of the rural population towards gram sabhas. Impact study on the effectiveness of service delivery in the project is not conducted, said the report.

Among other shortcomings, operation of the project funds through current accounts in bank resulted in loss of interest aggregating Rs. 1.06 crore. There were cases of misappropriation of funds because of which subsequent installments were not released to the Gram Panchayats, depriving the rural poor of the intended benefits.

The project has been helping 1,341gram panchayats in 39 most-backward taluks 14 districts to develop their capacities in revenue generation and in implementing welfare programmes.

The report said that the annual accounts prepared by urban local bodies in the State were not certified by Chartered Accountants for the years 2008-10.

The report on Local Bodies for the year ended March 31, 2010, was tabled in the Legislative Assembly on Wednesday, said the ''persistent savings were observed in both revenue and capital expenditure vis-a-vis budget provision over the last three years.”

The urban local bodies utilised only 42 per cent of Twelfth Finance Commission grants on solid waste management during the period 2005-10 as against the prescribed 50 per cent”.

Diversion of the Twelfth Finance Commission grant for other works in contravention of guidelines was also observed.

Short Payment of Rs 207.35 cr Property Tax

Instances of incorrect declaration of properties and their usage pattern led to short payment of property tax of Rs 207.35 crore during the 2008-10 in Bangalore, the CAG said in another report.

It said the implementation mechanism in property tax management by the Bruhat Bangalore Mahanagara Palike (BBMP) suffered from several deficiencies.

The CAG report on Panchayat Raj institutions for the year ended March 31, 2011, stated that “among others, the abnormal delay in conducting the physical survey of properties by the BBMP based on the digital mappings of the area geographical information system resulted in absence of a comprehensive database of properties.”

The CAG report said control mechanism as regards revenue collection was ineffective as evidenced from non-maintenance of database, non-verification of returns filed, unencashed cheques etc.

BBMP is statutorily empowered to levy and collect tax and non-tax revenues. The property tax has traditionally been and continues to be the principal source of revenue to upkeep the basic services in the city. BBMP collects property tax by way of unit area value based self assessment scheme.

The report said cash management of BBMP revealed that huge funds were retained in several bank accounts without transferring to nodal bank accounts and the balances were not reconciled.

''Bank accounts were operated in the name of individuals which is fraught with the risk of misappropriation of funds,” it said pointing out that, ''Cash books in respect of bank accounts were either not maintained or were incomplete.”

Unjustified action of the Chief Engineer of the BBMP in changing the scope of road drain work from Anand Rao Circle to Basaveshwara Circle led to undue benefit of Rs 87 lakh to a contractor.

''Action of the Chief Engineer, BBMP, in not following the prescribed specifications led to an avoidable extra payment of Rs. 39.49 lakh on road widening and strengthening of work from Mysore Bank circle to High Grounds police station,” the CAG said.