PANAJI
The Comptroller and Auditor General (CAG) of India has found that the Excise Department short-levied licence fees totalling Rs 43.98 lakh across hotels, bars and restaurants by wrongly identifying hotel categories and applying incorrect municipal classifications, which led to revenue losses that auditors seek must be urgently recovered.
In its report for the period ending March 2023 and tabled in the Legislative Assembly in the just concluded winter session, the CAG flagged Rs 33.59 lakh shortfall from hoteliers after excise stations in Pernem and Margao failed to verify the Tourism Department’s classification of hotels and their star ratings. The auditors stated that mistakes in identifying “B/C” category hotels and their star status led to lower licence fees being imposed during the audit period, covering 2019-20 to 2022-23.
“Scrutiny of records revealed short levy of licence fee amounting to Rs 19.60 lakh, which is recoverable along with leviable interest of Rs 13.99 lakh from 22 hoteliers,” the report stated.
The CAG said the lapses represented failures in basic verification. “The excise stations failed to verify the correctness of the category of the hotels, which resulted in short levy of licence fees of Rs 33.59 lakh,” it said, adding that the department must review all affected cases and recover dues on priority in the interest of Government revenue.
Auditors also urged the department to introduce stronger internal controls to prevent such lapses and plug the revenue leakage in the future. The report stated that the matter was referred to the government in April 2024, but no reply had been received as of January 2025.
A separate finding reported that the Excise Station in Mapusa short-levied Rs 10.39 lakh from 39 bars and bar-cum-restaurants after applying the licence fee rate meant for ‘B’ class municipalities instead of the higher rate applicable to Mapusa, which had been notified as an ‘A’ class municipality in March 2018.
The under-charging occurred between 2018-19 and 2020-21, although the correct fees were applied in 2021-22 and 2022-23. “On being pointed out, the Excise Inspector accepted the audit observation and stated that notices would be issued for recovery,” the report noted.
Calling the detected cases “illustrative and not exhaustive”, the auditors recommended a full departmental review to identify further short-levied fees and ensure recovery. This matter, too, was referred to the government in April 2024, and a response remained pending in January 2025.
