Govt report flags MVD's ₹1,200 cr tax arrears, recommends online service block for e-challan defaulters

As vehicle tax arrears in Kerala have crossed ₹1,200 crore, the Personnel and Administrative Reforms Department has recommended a series of stringent measures, including restricting access to online services for vehicle owners with pending e-challan dues.

In its recent Work Study Report, the department noted that outstanding motor vehicle tax arrears have exceeded ₹1,200 crore, with more than 90 per cent of the dues linked to transport vehicles. The report observed that existing recovery efforts have not been sufficiently effective. While adalats and one-time settlement schemes are being conducted to facilitate recovery, follow-up actions in most offices remain inadequate, it said.

To improve compliance, the department has recommended changes to its software systems to prevent vehicle owners with pending e-challan liabilities from submitting applications for services. At present, such applicants can submit requests through online portals, even though services are not granted until the dues are cleared. The proposed modification would allow applications to be filed only after all outstanding e-challan penalties have been settled.

According to the report, the measure would help reduce the accumulation of pending applications and enable faster scrutiny and processing of service requests. The department has recommended a detailed examination of the proposal and the implementation of necessary software changes.

The report also flagged concerns over the functioning of interstate check-posts, which are intended to detect vehicles entering Kerala without paying taxes, obtaining permits or complying with other legal requirements. Although these check-posts were established to strengthen enforcement, most currently operate only between 9 am and 5 pm.

The study committee observed that the limited eight-hour working schedule leaves vehicles free to cross state borders without scrutiny for the remaining sixteen hours of the day, undermining the very purpose of the check-posts. It further pointed out that violations are more likely to occur at night, when enforcement is generally weaker, and surveillance systems may not function optimally.

Keeping check-posts closed at night while operating them only during daytime hours is inadequate to achieve their intended objectives, the committee concluded, recommending a review of the present system to strengthen enforcement and improve revenue collection.