Lok Sabha Question No. 188 (STARRED), answered on 2016-07-29
Subject: Disbursement of Funds to States
Ministry: FINANCE
Asked by: BHEEMRAO BASWANTHRAO PATIL, BHARTRUHARI MAHTAB

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA

## STARRED QUESTION NO. *188

TO BE ANSWERED ON FRIDAY 29 TH  JULY, 2016 [7 Shravana, 1938 (SAKA)]

'Disbursement of Funds to States'

## No. *188, Shri Bheemrao B. Patil : Shri Bhartruhari Mahtab:

Will the MINISTER OF FINANCE be pleased to state:

- (a) whether the Union Government owes nearly ₹ 82,000 crore to States towards sharing of net proceeds of taxes and duties collected since   1999-2000 as mandated by the Article 270 of the Constitution;
- (b) if  so,  the  details  thereof,  State-wise  along  with  the  time  by  which  the  said amount is likely to be disbursed to the States;
- (c) whether the Union  Government has received any requests from the States and public representatives for speedy disbursal of the said fund;
- (d) whether the Union Government is unable to devolve to States their share from time to time, and if so, the amount of fund outstanding and reasons therefor, State-wise; and
- (e) the corrective steps taken/being taken in this regard?

## ANSWER

## FINANCE MINISTER

(a) to (e) : A Statement is placed on the Table of the House.

(SHRI ARUN JAITLEY)

## Statement referred to in reply to Lok Sabha Starred Question No. *188 for answer on July 29, 2016 raised by Shri Bheemrao B. Patil and Shri Bhartruhari Mahtab, Members of Parliament regarding 'Disbursement of Funds to States':

The 'net  proceeds'  of  Central  taxes  and  duties  are  shareable  between  the  Centre  and  the states according to the recommendations of the respective Finance Commission as accepted by the Government of India. The office of the Comptroller and Auditor General (C&AG) of India is required to certify the 'net proceeds' for each year based on the actuals prepared by the Controller General of Accounts. However, the office of the C&AG of India could not issue the certificate for the years 1996-97 to 2014-15, involving recommendations for four Finance  Commissions  i.e.  10 th Finance  Commission  to  13 th   Finance  Commission.  Such certificates  (for  nineteen  years)  had  been  issued  by    the  office  of  C&AG  of  India  during February,  2016,  reporting  the  total  of  the    year-wise  difference  to  be ` 81647.70  crore between net proceeds of Central Taxes and Duties assignable to States and the States' share actually devolved to all the states in those years. The C&AG's certificate is being examined in detail by the Government.

It is further mentioned that Union Government has not received any requests from the State Government and public representatives for speedy disbursal of shortfall in states' share in central  taxes  and  duties.  Further,  Union  Government  has  never  intended  to  withhold  the states' share of central taxes and duties. The devolution of states' share has been made as per the norms followed year after year. As the figures intimated by the office of the C&AG of  India  are  required  to  be  reconciled,  the  calculations  are  being  examined  by  the Government.

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