Pune: PMC may face financial distress due to diversion of GST grant towards unpaid water bills
Pune: The Maharashtra government has decided to divert the Goods and Services Tax (GST) grant provided to municipal corporations, specifically the Pune Municipal Corporation (PMC), to cover arrears pending to the water resources department.
The water resources department has informed the government that PMC has an outstanding balance of ₹187 crore, posing a financial burden if the state proceeds with its plans. PMC receives approximately ₹180 crore in GST grants from the state government each month.
On May 8, the state issued orders to civic bodies allowing them to claim GST grants for outstanding water bills. It has directed PMC to submit information regarding undisputed arrears of water bills. However, PMC has denied that it is required to pay any water bills owed to the water resources department.
The state government’s directive comes after the water resources department recently informed the state government about the arrears. According to the order, municipal corporations should contact the water resources department to determine the undisputed water bill outstanding, pay the dues, and share the details.
According to a senior water resources department official, “we informed the state government about arrears and undisputed water bill charges on May 6.”
The failure of PMC to submit outstanding details to authorities will result in the undisputed water tax amount calculated by the water resources department being deducted from the GST subsidy beginning next month.
Nandkishore Jagtap, head of the PMC water supply department, stated, “We sent an explanation of arrears to the state government on May 10, stating that the water resources department calculated arrears from 2016. They have charged commercial water charges rather than residential. We’ve cleared arrears here and there, but they’ve mentioned commercial water bill charges and fines.” Reported Hindustan Times.
According to water resources department officials, the state government approved an annual water usage of 11.50 thousand million cubic feet (TMC) for Pune under the Maharashtra Water Resources Regulatory Authority (MWRRA) rule, but PMC uses 18.50 TMC. The department imposed an administrative fine of ₹187 crore for excessive water consumption.
According to the water resources department, PMC supplies 10% of its quota for commercial purposes while charging only 2.5% of users. Civic officials refuted the claim, stating that PMC supplies 97.50 percent of its water quota to residents and the remainder to commercial users.
