PANAJI
While pointing out that the Goa Industrial Development Corporation (GIDC) has failed to manage its basic cost of continuing its operations through its own resources, the Comptroller and Auditor General (CAG) has slammed the Corporation for revenue waiver of Rs 16.98 crore in form of “transfer fees” to the industrial units.
The CAG in its communication to GIDC Managing Director said the waiver of transfer fees will adversely affect the financial results of GIDC. “To be an impactful catalyst in industrial development, GIDC must be financially strong and should be able to recover its costs from the allottees,” CAG said.
Regulations, notified in 2023 for allotment, sub-lease and transfer of industrial plots, has led to loss of Rs 16.98 crore during three years from 2020-21 to 2022-23. The transfer fees of Rs 5.42 crore were waived off in 2020-21 while another R 7.60cr was waived in 2021-22 and Rs 3.96 cr in the subsequent financial year.
GIDC maintained that the rationale for removal of transfer fee in the new regulations were done for acquisition of sick units by new industries and that transfers will lead to revision of lease rent and will also attract more investment in the State.
The Auditor noted that GIDC has not been able to recover its basic cost of continuing its operations from own resources as its finances runs into deficit. In 2020-21, the revenue deficit was above Rs 12.50 crore, which came down to Rs 11.70 crore in 2021-22.
It observed that in 2022-23, its total revenue was Rs 42.18 crore that included only Rs 19.31 cr revenue from operation and its expenses were almost Rs 42 crore.
The auditor also noted that the government does not bear the regular expenses of GIDC beyond the initial contribution or grants and the GIDC Act prescribes maintaining own fund comprising of fees, charges, rents, profits, etc with the powers to borrow from the market to augment the financial resources and with full authority to spend from the fund as deemed fit.
“GIDC does not have a financial plan to match operational revenues with its expenses resulting in operational losses every year. Absence of an economically viable financial plan is not in the interest of GIDC and should be reviewed,” the Auditor recommended.
