CAG
Tamil Nadu’s registration department may be collecting more in stamp duty and registration fees, but the CAG compliance audit for the year ended March 2024 has flagged significant leakages caused by undervaluation, misclassification and suppressed transaction details. A test check of 114 of the department’s 647 auditable offices found 967 cases involving ₹95.97 crore, highlighting gaps in the department’s scrutiny of property transactions. The department collected ₹19,013.35 crore in stamp duty and registration fees in 2023-24, up 8.28% from the previous year. Misclassification accounted for the bulk of the audit findings — 605 cases involving ₹85.84 crore-while 63 undervaluation cases involved ₹1.07 crore. Among the major cases, four transactions involving 14.945 acres in Venpedu and Vayallanallur were registered for ₹78.66 crore, although earlier MoUs indicated substantially higher agreed prices. The CAG estimated undervaluation at ₹71.16 crore and short collection at ₹7.83 crore.
But, the audit found that information available in sale deeds, MoUs, Form 26AS, project approvals and technical assessments was not being adequately correlated by registering officers.
At Ambattur and Thamal, three powers of attorney were registered without consideration, even though Form 26AS and subsequent sale deeds showed ₹100.08 crore had changed hands, resulting in a ₹4.99 crore shortfall. In one Ambattur case, ₹89.02 crore was reflected in Form 26AS against zero value in the power of attorney. The audit also flagged a ₹2.72 crore loss in a Thiruvottiyur demerger-related transaction involving Wimco and ITC; ₹1.69 crore has since been recovered and disciplinary action initiated. Misclassification of possession-related documents in Chennai South caused a ₹1.6 crore shortfall. At Sangagiri, an incorrect guideline value caused a ₹47.21 lakh loss. Four lease-surrender cases resulted in an escapement of about ₹34 lakh. Comparable transactions at Sunguvarchatram and Ambattur revealed further market-value discrepancies, causing a ₹26.96 lakh shortfall. At Neelankarai, suppression of an existing building caused another ₹17.55 lakh loss. Of 647 auditable units, only 114 were test-checked. It had 5,428 internal audits in arrears and 61,109 outstanding audit paragraphs involving ₹323.7 crore as of March 31, 2024. No audit committee meeting was held in 2023-24. Crucially, it said the cases were illustrative, leaving potential leakage in the remaining 533 units unanswered.
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