Secret Service expenditure - Income Tax - F. No. 6/26/2006-IFU(B&A)

F. No. 6/26/2006-IFU(B A) Date of Issue : 13.12.2006 Subject : Secret Service expenditure In its draft report on Performmance audit of the functioning of internal controls , the office of the Director General of Audit, Central Revenue, New Delhi has commented as under: An expenditure of Rs. 15 crore (Revenue Department; Rs.1.62 crore; Direct Taxes: Rs.4.52 crore; Indirect taxes; Rs.8.87 crore) was incurred during the years 2003-06 on secret services , Which are out of the purview of the audit. The expenditure on secret services is to be monitored by the respective Head of the Office through reports submitted by the officer designated for incurring expenditure on secret services. Test check revealed that expenditure had not been monitored and utilization certificate of secret service expenditure was not sent either to the office of the Accountant General or to the respective Pay and Accounts Offices as required under the Ministry of Finance, Department of Expenditure, standing orders. The department and the two Boards did not thus exercise any control over the expenditure on secret services . 2. In this connection, it is brought to the notice of all the Budgetary Authorities in the Dept. of Revenue including CBEC CBDT, that extant orders/instructions require establishing of adequate internal control mechanism by the Controlling Officers so that the spending from the Secret Service Funds are made diligently towards purchase of information, equipment or cultivating intelligence and informer bases etc. The Controlling Officers may allocate the required funds to the spending Officers who may maintain registers to record outgoing for each contingent expenditure within the allocation and also to furnish Utilization Certificate to the PAOs latest by-the 31st August of the following year. The Controlling Officer shall conduct at least one inspection in a year, which will be in the nature of administrative audit. 3. All controlling Officers under the Department of Revenue and CBEC are, therefore, requested to ensure that the spending from the SSF are managed within the Sanctioned Grant and the required procedures and checks are complied with, A confirmation report to the effect that the instructions are being followed may be furnished to the undersigned latest by 31st December, 2006. 4. Any proposal for unavoidable augmentation of funds should be supported by the details of raids, seizures and revenue collections attributable to the spending from the Secret Service Funds as there are restrictive provisions for reappropriation from and to the provisions of Secret Service Fund and augmentation during the course of a financial year are generally not agreed. 5. Pr.C.C.As/C.C.A. (Fin.) are requested to issue necessary directions to all PAOs under their control for watching the receipt of Utilization Certificates. Sd/- (M. Deena Dayaian) Financial Adviser