Prevention of Revenue Leakages in Local Bodies in Tamilnadu

Prevention of revenue leakages in local bodies:
by Dr.M.Valluvan, Former Chairman, Viriddhachalam Municipality.

My suggestions below would definitely rectify the revenue deficit if  attention  is given
With utmost sincerity and proper action is taken urgently. Preferably by a honest team of  patriotic officials who would work for the welfare of the nation.  


I would  suggest that if the  functioning of  local bodies [Corporations, Municipalities, Town panchayats and village panchayats] is properly  and strictly monitored by  a team of Honest retired army men , we can rectify the revenue deficit within a short period.  Corrupt practice of the officers of local bodies has let the nation to the present level of Non-attainment of self sufficiency in all aspects right from basic amenities to long- term modern living environment.
Dr.M.Valluvan, Former Chairman,
Viriddhachalam Municipality

For example My town[vriddhachalam municipality o Tamil Nadu state] can be taken as a material for research how it has been destroyed since 1965 by corrupt officers of the  supported  by  corrupt higher officials .evidence www.achievebyhonesty.org, www.achievebyhonesty.valluvan

Lay outs:

Any lay out must be promoted  in accordance with law and 100% implementation of all guidelines of the government.

The corrupt team of officials [Municipal officers, DTCP officers , state municipal administration headed by commissioner of municipal administration [CMA], Director of vigilance and anti corruption [DV &AC]  had neglected the evidence based complaints given by me as chairperson of vriddhachalam municipality in office between 2001 to 2006.


Moreover the corrupt team was able to approve the layouts without proper basic amenities  like approach road, water supply, electricity, drainage channels, roads by  the municipal council which took over the office later i.e.between 2006-2011.

In Tamil Nadu alone there are about FIVE lac acres of agricultural land being converted into layouts without following the law and guidelines making a huge revenue loss to the local bodis. About twenty  lakh rupees  per acre of land must be spent by the promoter to provide all infrastructure like roads, drainage channels, electrification, water supply apart from paying proper fees to the local bodies before completion of the project.

In Tamil nadu alone the revenue loss would be around 5,00,000 acres x 20,00,000 rupees=1,00,000,00,00,000 rupees. Or  ONE LAC CRORE  RUPEES.

If proper action is taken in all the states of our nation the amount would be very high and unimaginable.
Plan approval..!

Any construction,residential, commercial or / industrial should get their plan of construction, approved  by the local bodies after paying proper fees. i.e.all  the buildings in any local body do not follow this creating heavy revenue leakage to the concerned local body indirectly to the nation.

By the modern electronic technologies, if the addresses of all electrical connections in a town or village given by the electricity department are compared with the addresses of plan approved buildings in that village or town this disparity could be easily found out. Notices should be given to the buildings without plan approvals to recover the revenue leakage within a specific period.

Property tax..!

Income from Property tax is the backbone for any local body. The corrupt  officials  omit lot of buildings to fix the property tax  and issue notice for more than 5 years and commit by fixing lesser amount as property tax in contrary to real amount  by getting bribe from the owner of the building and making huge revenue loss not only  to the local body but also to the nation .As on 30.9.2011,In my town alone 16201 new buildings[residential, commercial and industrial purpose]were left without fixing property tax equivalent to an amount of   200,00,000 rupees.

 In Tamil nadu , there are 12 corporations, 150 Municipalities, 561 town panchayats and 12600 village panchayats. If the modern technology like GPS is used to map any building by a central monitoring team to fix property tax for all the buildings without omission and commission , the revenue of any local body will reach the peak to attain self-sufficiency in revenue to fulfill their needs  and in turn convert the nation economically sound.   

Profession tax..!

 Not all business men in any local body are given demand notice to pay  their  profession tax. Profession tax of the government employees is the only one which is collected regularly. There is a huge revenue leakage created by the corrupt officials in any local body.

A new system must be evaluated for 100% profession tax collection from all categories.

 100%tax collection..!
 All taxes like property tax, water and drainage tax, profession tax, entertainment tax and non-tax revenues like licensing fees, rents and contract fees must be collected fully within a specific period.

2.Recovery from audit objections ..!

 The financial activities  of local bodies are audited by local fund audit department of finance department . All procedure violations, omissions ,commissions and corrective procedures are given in detail in the audit reports.

Audit report of the previous financial year should be placed before the council, all the pages of audit report should be read in the council meeting and action should be taken by the Executive officer of the concerned local body within six months.

But the corrupt  officials have not initiated the procedure since Independence  in almost all corporations, Municipalities and town panchayats of our state . In short It is the public money paid as various taxes by innocent citizens being misused and reported as audit objections in the audit report.

From Audit report of urban local bodies of Tamil Nadu received under RTI Act .
The report indicates rupees 20000 crores as due in the urban local bodies {corporations, Municipalities and Town panchayats} of Tamil Nadu upto  March 2010.

INTERESTINGLY, THE AUDITORS OF LOCAL FUND AUDIT DEPARTMENT ARE ALSO PAID BY GOVERNMENT TO AUDIT THE VARIOUS PROCEDURES,TRANSACTIONS OF MUNICIPAL ADMINISTRATION .


This is only a tip of an iceberg. The same status prevails in almost all the states.

We should evaluate a  new system to correct this at the earliest. If not, at least abolish the LOCAL FUND audit department of Tamil nadu to safe guard the tax payers money being wasted for preparing useless audit reports.


3.To Monitor the works in any local body by honest central team..!
If proper attention is  given to monitor the quality of  various works , it will save lot of money being misused .

One rupee saved is equivalent to two rupees earned.

 4. Water Bodies Management..!
In Tamil nadu there are about 38,000 lakes, out of which only 28,000 lakes could be saved if action is taken immediately.

I suggest that the superficial layer of the lakes could be given to the local farmers at a nominal rate.Another two or three metres of sand could be utilized as M-SAND for construction purpose at a nominal rate.

This will deepen the lakes to fetch more water, prevent destruction of  rivers from sand smugglers, increase the ground water table, prevent flood water going to sea, reduce the flood damage and flood relief fund, increase the agricultural income, save drought relief fund in addition to climate protection by trees if planted around the water bodies. Indirectly this will reduce the financial burden of the state and in turn the centre.

5.Nationalisation of jewels of TEMPLE..!

Jewels worth of many crores  of rupees is being handled in many temples. corrupt people misuse this.
To prevent corruption and to utilize the jewels being kept idly without any use, a system may be evaluated  to nationalize the jewels and valuable ornaments and use them for the nation’s improvement  by the best suitable manner. 
We have everything. We need not depend upon the world bank or / other countries.

Dr.M.valluvan  M.B.B.S., D.O,
EX CHAIRPERSON,
88,Mariamman Koil Street,
Vriddhachalam - 606 001

Tamil Nadu state
www.achievebyhonesty.org
www.achievebyhonesty.valluvan

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