Non-verification of PLAs and non-reconciliation of revenue receipts by Chief Accounting Officers - System defects - Instructions for speedy reconciliations - Regarding - Central Excise - 80/80/94-CX.8

Non-verification of PLAs and non-reconciliation of revenue receipts by Chief Accounting Officers - System defects - Instructions for speedy reconciliations - Regarding Circular No. 80/80/94-CX.8 Dated 21-11-1994 [From F. No. 268/26/94-CX.8] Government of India Ministry of Finance (Department of Revenue) Central Board of Excise Customs, New Delhi Subject : Non-verification of PLAs and non-reconciliation of revenue receipts by Chief Accounting Officers - System defects - Instructions for speedy reconciliations - Regarding. The Public Accounts Committee (1987-88) in their 110th Report (8th Lok Sabha) and in 16th Report (9th Lok Sabha) expressed disappointment over the issue of non-completion of re-conciliation of revenue figures in the monthly statements of Range Officers with the figures booked in the accounts of PAOs so as to ensure proper accounting of revenue and recommended that Ministry should make concerted efforts to complete the reconciliation work within a specified time-limit and the progress of the work should also be periodically monitored by higher authorities. Accordingly Central Board of Excise Customs vide their Circular No. 15/90-CX-8 (F. No. 263/9/90-CX.8) prescribed a time-limit of six months for completing the reconciliation work and instructed the Collector to pay more attention to the reconciliation work. 2. C AG vide Para 2.22 of Audit Report 1992-93 (No. 4 of 1994) have however once again brought to the notice of the PAC the — (1) Delay in receipt of PLA by CAO from Range Officer and in verification of PLA with monthly account prepared by PAO; (2) Non-verification of PLA wherever received; (3) Non-completion of reconciliation of revenue figures reported by Range Officers and PAO; (4) Non-verification of receipts of refund revenues; and (5) Delays by Public Sector Banks in remitting duty collections. According to Audit, the pendency in respect of verification and reconciliation by CAO is very alarming and in some Collectorates it is pending right from 1988-89 onwards. It was also pointed out that huge amounts are shown as 'less credit' and 'more credit' and pending final adjustment from 1988-89 onwards. Reports received from the Collectors suggest that adequate attentions are not being paid on this item of work, resulting in huge pendency on account of inadequate staff strength delay in receipt of Quadruplicate copy from focal bank/nominated range officer and receipt of incomplete challans. As pointed out by PAC in their earlier reports reconciliation of revenue receipts/refunds is very important in the 'revenue accounting system' and non-reconciliation would lead to frauds by unscrupulous assessees and reporting incorrect revenue figures to the Government. 3. The issue raised on above Paras have been examined by the Board. It is observed that Chapter XII of the Revenue Accounts manual (copy enclosed) deals with procedure on reconciliation of revenue receipts. 3(1). As per the procedure, monthly revenue statement shall be prepared on the basis of duplicate copy of challans received from Assessees and sent by Range Officers to CAO so as to reach him by 10th of the following months. He shall also send Quadruplicate copies of TR-6 Challan and copies of PLA showing all the details of payments to Chief Accounts Officer so as to reach him by 10th of the following month. 3(2). Chief Accounts Officers are required to check the credit entries in PLA from the original treasury documents. The scales of Checks with reference to credit entries shall be 100%, 25% and 5% at the level of U.D.C., D.O.L. Level I/II and A.C.A.O or CAO respectively. CAO shall also reconcile the monthly statements of revenue receipts received from the Range Officers with the figures booked by the Pay Accounts Officer in his monthly account with the supporting challans and trace the challans as entered in the monthly compilation sheets of revenue complied by the Pay and Accounts officers in respect of each focal point Bank. 3(3). Any amount mis-classified in the Pay and Accounts Officers should be pointed out to the Pay and Accounts Officers and got set right through transfer entries on the spot. A statement is required to be prepared by CAO in the check register of tax revenue receipts about the particulars of challans which remain unreconciled either in the monthly statement of range officer or in the compilation sheets of Pay and Accounts Officer. 3(4). While in case of challans appearing in the compilation sheets of the Pay and Accounts Officers but not in the monthly statement of the Range Officer (a case of more credit in PAO's Book), Chief Accounts Officer should initiate the correspondence with the Range Officer, in case of challans appearing in the monthly statement of Range Officer but not in the compilation sheets of the Pay Accounts officer. (A case of less credit in PAO's books) the Pay Accounts Officers shall make the correspondence with the concerned focal point Bank. For this purpose the Pay Accounts Officer will refer to the check register of the Chief Accounts Officer. 3(5). The adjustment of outstanding items shall be made in the check register and shall be reviewed by the Chief Accounts Officer every month to see that it has been posted properly and items do not remain outstanding for long. 3(6). Similarly Pay Accounts Officer will maintain a register wherein progressive differences shall be worked out at the close of every month. This register shall be posted from the check register referred to above and the items remaining outstanding for over three months shall be specifically brought to the notice of Collector by the Pay Accounts Officer by 25th of every month for taking up the matter with concerned officer (Para 12.1.3 refers). 4. In the above connection, it has been decided by Board that - 4.1. The time limit prescribed for submitting copy of PLA and revenue statement so as to reach to the office of CAO by 10th of the following month should be strictly followed irrespective of the fact that assessments have not been completed. 4.2. CAO shall complete checking of credit entries in PLA from the original treasury documents (original copy of TR-6) received from PAO within 15 days from the receipt of said document from Range Officer, i.e., latest by 25th of the following month. 4.3. Reconciliation of revenue receipts by the CAO with the Pay Accounts Officers figures reported in his monthly statement should be completed within 10 days from the date of receipt of scrolls. 4.4. Follow up actions for adjustment of less credit/more credit should be taken up by PAO/CAO with respective focal Point Bank/Range Officer within three months from the date of noticing such less credit/more credit etc. 4.5 In any case reconciliation work in respect of any given period should be completed in all respects within six months as laid down in Board's Circular No. 15/90-CX.8, dated 22-3-1990. 4.6 In no circumstances there should be delay in forwarding copies of PLAs to CAO on the pretext that assessment is not complete. 4.7 Steps should be taken to ensure prompt receipt of quadruplicate copies of the challans by the Range Officers through the nominated Central Excise Officers. If necessary, the nominated Range Officer should be asked to depute an officer to the focal point bank for collection of the quadruplicate copy of the challan instead of waiting for their despatch by the Focal Point Bank in a normal course. Similarly the Range Officer may depute an officer to be nominated Range Officer and collect copies of the challans concerning their range. 4.8. Wherever the facility of computers exist the same should by used for monitoring of the verification/reconciliation by CAO after developing the requisite Software. 5. The Collectors should personally monitor the reconciliation and verification by conducting monthly review of the work done by the CAO and PAO and submit a monthly report to the Principal Collector by 29th of every month (as prescribed in the proforma indicating the discrepancies noticed and action taken to adjust the previous month's discrepancies). The Principal Collector shall closely monitor and ensure timely completion of revenue reconciliation work. Reconciliation in any case should be completed within six months. Instances of non-completion of reconciliation within the stipulated time frame shall be however brought to notice of the Board by the Principal Collector along with reasons thereof and remedial measures taken. 6. The position and progress of reconciliation work should also be reported in a separate para in monthly report submitted by Collector to Board. 7. Directorate General, National Academy of Customs, Excise Narcotics, shall organise the courses for imparting the necessary skills/training to the persons posted with CAO/ACAO/Other Accounts staff so as to train them on the issue of reconciliation of revenue receipts and their proper accountal. 8. In the prescribed proforma for inspections of various offices, particularly Collectorate, a paragraph on reconciliation of revenue receipts should be added immediately after the Revenue realisation para. During Inspections, the progress in this regard should be seen. Detailed comments on the progress should be given by the Inspecting Officer. Non-reconciliation of Revenue receipts should be studied and commented in detail and the specific action proposed against defaulting officers. 9. Field formations may please be informed suitably. Proforma Monthly Statement for Revenue Reconciliation Month Collectorate : ..................................... : ................................................ Amount Booked by PAO Amount Booked By Range Officer Discrepancies Notified by CAO Adjustment against Previous Months Pending Less Credit More Credit Less  Credit More  Credit (1) (2) (3) (4) (5) (6) Amount Pending Recon Ciliation (Total Progress) Amount of Refund Granted (Booked by PAO) Remarks Less More (7) (8) (9) (10)