States Have a Right on Money From Central Taxes: Mitra
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The war of words between Congress and the West Bengal government over Central assistance continued today with Finance minister Amit Mitra saying money given to states was their "legitimate right" under constitutional provisions and not the Centre's "mercy".

"Constitutional provision 272 makes it a right of the state to receive from the Central taxes including Income Tax which is all that we have got," Mitra said.

The Finance Minister was giving his views on the press statement by Congress leader Abhishek Manu Singhvi yesterday claiming that between May 20, 2011 to February 6, 2012, Rs 23,695 crore approximately was disbursed/released to state.

Stating that West Bengal had received less than other states on that count, he said, "Upto December one last year the state has got Rs 12,321 crore against Rs 33,376 crore given to Uttar Pradesh, Rs 18,517 crore to Bihar and Rs 12,077 crore to Madhya Pradesh."

He said West Bengal was to get Rs 19,000 crore as share from Central taxes in the current financial year. "In the remaining months we are expecting to get from the Centre another Rs 7,000 crore."

Mitra said "if anyone says that it is showing mercy by giving this amount to the state it will be wrong. To get money from the taxes collected by the Centre is the rightful demand of the states and that of West Bengal as per the decision of the Finance Commission".

"I do know because I have not spoken to him (Singhvi) whether he was aware of this constitutional dimension ... That this amount (share from the Central taxes) is due to the state. I do not want to comment whether he was lying. You will have to read into what he said and what I said to make a logical conclusion."

Mitra said the Finance Commission had decided that by 2010-15, 32 per cent of the total taxes collected by the Central government would be given to all states.

"In brief out of 100 rupees total collection (of taxes by the Centre) West Bengal will get 2.3 per cent of the tax. This is our right.

"This is bolstered by Section 272 of the Constitution which says that tax collected by the Centre will be distributed between the states and the Centre. Besides the funds are also given by the Centre to the state on four other categories including MNREGA," Mitra said.

He said that in 2005-06, projectwise grant of Rs 8,500 crore was given to Bihar. In line with that West Bengal was considered for project-based grant of Rs 8,760 crore for the backward districts.

"All I can say when I spoke to you on February six when I emphasised and stood by my statement that we have not received a single farthing from the Centre than what is Constitutionally guaranteed. Only after I spoke to you we got Rs 1,064 crore under the Backward Region Grant Fund found on 7th of February which is only project-based. And, it cannot be given for salary, for interest payment and repayment.

"The money from the Central share that is what we have got. The only additional thing is Rs 1,064 that was received on February 7 after I spoke to you. Other than this we have not received a farthing from the Centre. Discussions are going on for further grants on BRGF fund project-wise."

Mitra said West Bengal had a debt burden of Rs 2.3 lakh crore, the highest in the country left by the previous Left Front government and urged the Centre to give a three-year moratorium on the loan amount.

"The government has to shell out Rs 22,000 crore a year as interest and part of the principal to service the huge debt left by the previous CPI(M)-led government.

"The money goes straight from the state coffers. We do not even get to see it. Imagine how many schools, hospitals and other infrastructure could have have been set up if the Centre declared a moratorium on the loan amount," he said.

"So 2.3 lakh crore of debt hangs on our shoulder. We are looking for a possibility of a moratorium for a period of three years on Rs 22,000 crore which we have to shell out as interest and part of the principal."

Mitra said "we have already spoken to Prime Minister Manmohan Singh and the Finance Minister Pranab Mukherjee a number of times to give us a moratorium on the Rs 22,000 crore which we will use for hospitals, schools and water supply".

Unfortunately there is no movement on that count. Discussions are still one, he said and expressed the hope that the Centre would accede to the state government's request in this regard.

Singhvi had yesterday stated "I had only said that in 2011-12 financial year, the Central government had approved Central assistance of about Rs 8750 crore to West Bengal (under BRGF scheme), I had talked only about allocation/approvals, not disbursals."

Singhvi in his statement released from the state Congress office here had added "from May 2011 to February 2012, approximately Rs 23,695 crore has been disbursed/released by the Centre to WB."

This, he said, "included releases for state sector schemes, finance commission grants, WB's share in central taxes, central plan schemes, releases under other central schemes like sanitation, MNREGA, rural drinking water, rural housing, education and literary programmes."
Emerging story. Watch this space for updates as more details come in
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