Report No.2 of 2026-The Report of the Comptroller and Auditor General of India on State Reve…

This audit examined the state revenue receipts and tax administration of the Government of Kerala for the period ended March 2024. It covered sectors including vehicle taxes, excise duty, stamp duty, registration fees, and agricultural income tax.

Government of Kerala, specifically the Motor Vehicles Department, Excise Department, Registration Department, Forest Department, and State Goods & Services Tax Department.

• Total revenue impact of findings is ₹603.53 crore across 11 paragraphs.
• ₹37.48 crore was spent on modernization (Automated Driving Test Tracks and Testing Stations), but only two tracks were functional and none of the stations were operational.
• ₹2.57 crore in Green Tax was not levied due to reliance on self-declarations.
• ₹23.12 crore in penalties and fees were not collected from 48,059 vehicles operating with expired Certificates of Fitness.
• ₹24.57 crore in fines and renewal fees were not collected from vehicles with expired Registration Certificates.
• ₹12.18 crore in compounding fees were not collected from vehicles operating without valid permits or certificates.
• ₹51.88 crore in revenue was lost due to unaccounted Extra Neutral Alcohol (ENA) stock at a distillery in Thiruvalla, with no recovery action taken.
• ₹13.81 crore in Turnover Tax was not levied on a brewery in Kanjikode that incorrectly claimed an exemption meant for distilleries.
• ₹1.65 crore in Turnover Tax was short-levied due to calculation errors by assessing authorities.
• ₹3.71 crore in Sales Tax was short-levied due to incorrect tax rates applied by assessing officers.
• ₹5.10 crore in estimated revenue was lost due to the possible diversion of 12,302 cases of imported liquor intended for Mahe into the Kerala market.
• ₹27.40 crore in lease rent was short-collected from a rubber company due to non-revision of rates.
• ₹1.70 crore in Forest Revenue was lost due to non-levy of revised licence fees from the Government of Tamil Nadu.
• Recommendations include automating driver license issuance, conducting regular independent stock verifications in distilleries, and implementing GPS-enabled transit permit tracking.

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