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Comptroller And Auditor General (CAG) Pulls Up Education Department Spending Too Much


By siddharth22, Section Education
Posted on Sun Apr 20, 2008 at 11:14:09 PM EST

Failure to fulfil the conditions to avail an exemption in excise duty has cost the state school education department an additional expenditure amounting to Rs 1.83 crore. The department has been pulled up, in the recently released Comptroller and Auditor General (CAG) report for spending an extra Rs 1.83 crore on procurement of paper for printing textbooks. The report said this could have been avoided, had the department given the paper order directly to the supplier.

Every year the department's primary section distributes textbooks free of cost to the students studying in classes I to V in government-sponsored schools. The department procures paper required for printing textbooks from Hindustan Paper Corporation Limited (HPCL), a Government of India undertaking. The work of printing books on a lump sum basis and their distribution to the district godowns was assigned to Saraswaty Press Limited (SPL), which is a state owned company.

For the academic year 2006-2007, the department instructed SPL in August 2005 to directly purchase the paper required for printing textbooks from HPCL. Following the instruction, SPL placed the order for supplying 4,785 tonnes of paper with HPCL in November 2005. In between December 2005 and March 2006, HPCL supplied 4,188 tonnes of paper amounting to Rs 13.02 crore, of which, Rs 1.83 crore was spent on excise duty. According to Central excise exemption norms, the department can avail an exemption from excise duty if they place the procurement order for paper for nationalised textbooks (NT) directly to the supplier. In order to enjoy the exemption facility, the department has to declare the entire quantity of excise-exempted papers will be utilised for printing of NT books only.

As the department had no direct interaction with HPCL over the procurement order, the declaration for availing the excise duty exemption was not submitted. Thus the department duly made the payment as presented by HPCL without realising that it included additional expenditure on excise duty. Speaking about the ignorance of the department, the report even mentioned that "the department, while admitting the audit findings, attributes the same to its ignorance about the extant rule position on central excise exemption." Interestingly, for the academic years 2004-2005, 2005-2006 and 2007-2008 the department availed an exemption on excise-duty as placed direct orders with HPCL.

Source:The Statesman,21-04-08

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