The Income Tax Welfare Fund - 100 Crore lying unutilised
MINISTRY of Finance, Department of Revenue created the Income Tax Welfare Fund (ITWF) by transfer of Rs. 100 crore over a period of three years from 2006-07 to 2008-09 in interest bearing section of Public Account. The Fund was created with the purpose of (i) promotion of welfare, recreation and other outdoor activities of officials of the Income Tax Department, (ii) providing financial help to officials during contingencies such as injuries or accidents, (iii) providing ex-gratia payment to families of deceased officials, (iv) providing medical maintenance not fully reimbursable under CGHS, etc.
The Comptroller and Auditor General had not agreed to the creation of the Fund on the ground that the activities proposed to be covered by the Fund should be included in the annual budget of the Department and be financed through the normal budgetary process. The objective to cover officials/family members of officials who faced injury/death during search/seizure operations and provision of high risk insurance cover could be provided under a designated scheme of the Government of India or included in the existing provisions under the funds in existence for such purposes. The other purpose cited could be covered under the standard object heads "Rewards", "Medical treatment", "Office expenses", "Grants-in-aid" in the demand for grants of the Ministry. The creation of the Fund under interest-bearing section of the Public Account entailed recurring liability of interest, which would not be subject to usual parliamentary financial control. The utilisation of the Fund would not be reported through the standard object heads as is the case with the demand for grants presented in the Parliament leading to non-transparency. General Financial Rules (GFR) also do not permit expenditure from public moneys for the benefit of a section of people or individuals unless said expenditure was in pursuance of recognised policy.
The Department told Audit that no expenditure had been incurred out of the accumulated corpus of Rs. 100 crore and no interest had been credited into this Fund since its inception.
Please also see Story of Income Tax Welfare Fund - DDT 2603 22 05 2015