ACB raids on BBMP vindicate TheBengaluruLive report on how advertising agencies evaded taxes
Among other eye-openers, anti-corruption sleuths seize Rs 1.18 lakh in cash from a Storm Water Drain engineer in the West zone after he failed to produce the relevant documents
BENGALURU:
Nearly five months after a report by TheBengaluruLive on how the BBMP dozed on tax evasion and how 12 advertising agencies in Bengaluru owe Rs 26.83 crore taxes to the civic agency, the TBL report stands vindicated by the findings of Karnataka’s Anti-Corruption Bureau sleuths.
TheBengaluruLive on October 4, 2021, was the first to report about the irregularities in the BBMP’s advertisement wing and how BBMP had slept over its own report and had failed to collect a massive amount in taxes.
This year, on February 25, ACB sleuths conducted a massive raid on BBMP’s head office and various zonal offices. Late on Wednesday night, March 2, the sleuths put out a four-page press release on the conclusion of their investigation.
The report highlighted the mismanagement in BBMP’s advertisement wing with officials failing to collect taxes from various agencies. “It is estimated so far that BBMP has failed to collect Rs 300 crore through advertisement taxes and has incurred a loss to the exchequer,” the release read.
It added that civic officials had even failed to collect Rs 27 crore in taxes from bus shelters and pedestrian skywalks within BBMP limits, stating: “The officials have also not collected Rs 6 crore in taxes from bus shelters which have been constructed under the PPP model.”
Among the other findings in the ACB report are:
Transfer of Development Rights (TDR)
• As per the documents verified, to get more benefits from TDR, sub-standard structures were built, and later new structures were built on the same property.
• It is also noticed that several roads are shown as being widened without it being so, and illegal benefits were obtained.
• Fake documents pertaining to the government’s ‘kharab’ lands were created and further TDR certificates were issued.
• TDR loading: Once the DRC (Development of Rights Certificate) is issued, it needs to be loaded on high-rise buildings to get more FAR (floor area ratio). But the Town Planning department officials have misused (this route) and incurred losses of crores to the exchequer.
Also Read:200 anti-corruption sleuths search 27 offices of BBMP
Town Planning
• In lakes and some buffer zone areas, it has been noticed that unauthorized apartments were granted plan sanctions without even conducting an inspection. Several files have been seized and verification is under progress.
• Occupancy certificates have already been issued for buildings which are still under construction.
• Approval to build a three-storied building was given, but in reality a six-storied building was constructed and officials have not initiated any action against the illegal structure.
• Documents of all buildings above 10 floors and of apartments which are being constructed in an area of more than 2 acres and above are being examined, and the assessment is of a tax loss of crores to BBMP.
Revenue Division
• Inspection was conducted in three BBMP zones and it has been found that tax was reduced on commercial complexes.
• It was also found that taxes were reduced on residential properties.
• Multi-storied structures of software companies, and structures constructed with the aim of collecting rent, have been assessed to property tax of residential properties, incurring huge losses to BBMP.
• Instead of conducting physical measurements of residential buildings and fixing rents on these buildings, officials have fixed lower property taxes and entered them in the official books.
• Newly constructed buildings/complexes are found to be entered in older zones and lower taxes were fixed.
• 7 such files have been seized for inspection and verification is being carried out on the loss of Rs 217 crore in taxes to BBMP.
• In some cases, the construction of penthouses has been kept out of the tax net.
Also Read: ACB sleuths seize 45 BBMP files, including 21 from Town Planning section
Storm Water Drains
• The ACB has seized Rs 1.18 lakh in cash from BBMP’s Storm Water Drain AEE, for which he could not produce valid documents.
• Documents relating to Storm Water Drain works worth Rs 1,050 crore executed since 2017 have been recovered and verification of audit reports is ongoing.
• Files related to silt removal from drains are being verified.
Solid Waste Management
• According to the audit report for 2014-15, it is mentioned that Rs 75 crore is over-billed. BBMP officials have not taken any action on the over-billed amount.
• An estimate of more than Rs 100 crore in ‘misconduct’ has been reported and file verification is under progress.
Accounts/Finance Section
• After observing irregularities in tender files, some files have been seized and verification is under progress.
• Works not undertaken were shown as undertaken and completed to benefit a few contractors. Further, bills were also paid.
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