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S Corp charge against state govt over share

Statesman News Service |

New Delhi, 15 July
South Corporation has jumped into the arena against Delhi government for slashing Rs 300 crore in the name of interest and loan repayment out of Rs 350 crore that was approved as global share for the current financial year. The civic body has sought a detailed information of loans and other liabilities on it in writing from the Delhi government.
"It’s a well planned strategy of Delhi government to keep us in the ‘vicious cycle of debt’. The government gives us the revenue share after deducting the interest and liabilities. In fact, we get a small fraction of what is allocated to us that too is delayed by months," said Rajesh Gehlot, Chairman of Standing Committee of South DMC.
He further alleged that the government is acting like a cruel money lender. "Delhi government gives us loan for development and civic services at a very high interest rate of 10.5 per cent due to which almost all the money allocated for municipal corporations goes into paying the interest and loan amount,"  Gehlot added.
The government had allocated Rs 350 crore as global share for South DMC but has slashed around Rs 300 crore in the name of interest and outstanding loan. The corporation has written to Delhi government to provide details of loan and liabilities but a reply is still awaiting.
Commenting on the situation, Chief Accountant cum Financial Advisor (CA cum FA) of South DMC Rajesh Pathak said, "Delhi government recently released around Rs 26 crore instead of Rs 87.5 crore as first instalment of global share that too was adjusted for a parking project. Thus in reality we did not get even a single rupee in our account as the first instalment of the current financial year."
He further added that the money in the rest of the three instalments would be around Rs 10 crore each or less as government will deduct more money as interest and principal of loan. The global share is the revenue share of the municipal corporation which is mandatory under the recommendations of State Finance Commission. ‘The government also slashed its contribution in primary education from 70 percent to 50 percent which is 95 percent in other states,’ informed Gehlot. According to officers of the civic bodies, Delhi government is delaying the second and third instalments of revenue shares which was due in June.