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  Metros   Mumbai  30 Mar 2018  Guarantees to loans of corporations come under scanner

Guarantees to loans of corporations come under scanner

THE ASIAN AGE.
Published : Mar 30, 2018, 2:46 am IST
Updated : Mar 30, 2018, 2:46 am IST

The government issued guarantees of Rs 15,865 crore in 2016-17, which has increased it contingent liabilities.

However, the Maharashtra government has not fixed any limit in this regard so far, which is fiscal indiscipline, the CAG observed.
 However, the Maharashtra government has not fixed any limit in this regard so far, which is fiscal indiscipline, the CAG observed.

Mumbai: The Comptroller and Auditor General of India (CAG) has raised an objection over the absence of a limit for giving government guarantees to loans of corporations, companies and cooperative societies.

The government issued guarantees of Rs 15,865 crore in 2016-17, which has increased it contingent liabilities.

The CAG  report pointed out that as per Article 293 of the Constitution of India, limits for giving guarantees by the state government has to be fixed by the state legislature.

However, the Maharashtra government has not fixed any limit in this regard so far, which is fiscal indiscipline, the CAG observed.

The government gave guarantees of Rs 15,865 crore in 2016-17, Rs 19, 818 crore in 2015-16 and Rs 22,286 crore in 2014-15. The government takes guarantee fees from 20 paise to Rs 2 per Rs 100 per annum. Rs 11.82 crore was received during the year 2016-17, but details about Rs 9.87 crore has not been made available to the CAG or reflected in the book of accounts.

Tags: constitution of india, comptroller and auditor general of india