1% Incremental Revenue Scheme

With a view to encouraging greater effort at garnering revenues to the Government, the 1% Incremental revenue Scheme was initiated in 2006-07 for revenue generating/earning/ collecting Ministries/ Departments, under which an amount equal to 1% of the incremental revenue has been earmarked as incentive provision for enhancing the organizational efficiency, infrastructure and wherewithal. The Department works out the details of relevant schemes based on the principle of enhanced provisions for augmenting operational efficiency arising out of the incremental revenues earned beyond the budget targets on the basis of following guidelines:

• Schemes should be formulated for improving the permanent infrastructure or assets and intended towards long-term benefits of the Department.
• Schemes which are basically consumption oriented and recurring in nature should be avoided.

2. For implementation of the 1% Incremental Revenue scheme, two Committees have been constituted by the Board for formulating proposals for utilization of funds under the scheme.

First Committee- The first Committee is headed by DG (HRD) and comprises Commissioner (Coordination), Commissioner (Anti-Smuggling), ADG (I & W), Commissioner (Logistics), F.A. or his nominee, and one representative each from Directorate of Systems, DG, NACIN, Pr. CCA, CBIC as special invitee.

Second Committee- The second Committee comprises three Director Generals, namely, DG (GSTI), DG (DRI), and DG (HRD).

2.1 Principal Commissioner (Logistics) is the Nodal officer for implementation of 1% Incremental Revenue scheme and invites proposal from the CBIC formations. Proposals/suggestions received from field formations are scrutinized as per the above broad guidelines by the First Committee and the Second Committee constituted for utilization of funds available under the scheme. The proposals found in conformity of the broad guidelines are placed for consideration of the Board through the two Committees. Proposals approved by the Board are submitted to IFU for obtaining sanction of the competent authority.

3. Budget-Under the 1% Incremental Revenue Scheme, CBIC received Rs. 71.42 Crore in the year 2006-07; Rs. 113.63 in the year 2007-08; Rs. 313.17 Crore in the year 2011-12, totalling to an amount of Rs. 498.22 crores till the year 2020-21. Out of this entitlement, CBIC has utilized funds as per table below from the FY 2007-08 to 2019-20; totalling to an amount of Rs. 323.1233 crores up to the end of FY 2019-20, leaving the balance of Rs. 175.0967crore.

Financial Year	Amount Utilised (in Crores)
2007-08	Rs.29.41
2008-09	Rs.16.11
2009-10	Rs.27.6
2010-11	Rs.33.04
2011-12	Rs.23.28
2012-13	Rs.30.96/td>
2013-14	Rs.30.99
2014-15	Rs.33.43
2015-16	Rs.50
2016-17	Rs.0.796
2017-18	Rs.15.18
2018-19	Rs.19.56
2019-20	Rs.12.74

From this balance, an amount of Rs 40 crore was budgeted under the scheme for the current year FY 2020-21. During the year 2020-21 proposals worth Rs. 35.72 crores were forwarded for revalidation and fresh proposals worth Rs. 2.1 Crore were recommended by the two Committees and proposals worth Rs. 8.46 crores were finally revalidated (Rs. 7.57 crore)/ fresh sanctioned (Rs. 0.89 Crore) by the Board and the IFU. Thus, we may have around Rs. 166 crores balance available under the fund by the end of FY 2020-21.

3.1 Some of the substantial proposals recommended and sanctioned under the scheme since 2017-18 are mentioned below –

S.No.	Year	Proposal	Amount Involved
1	2017-18	Upgradation of Revenue Laboratory, Custom House, Chennai, through PWD by Chief Commissionerate of Customs, Chennai	1.19
		Purchase of 80 motorcycles by DGGSTI, for 40 Regional Units, 26 Zonal Units and DGGSTI (Hqrs.)	0.86
2	2018-19	Purchase of 13 Porta Cabins by Customs (Prev.), Kolkata.	0.78
		Purchase of 155 laptops by DGGSTI, New Delhi	1.04
3	2019-20	Acquiring furniture for setting up of new upgraded laboratory by Commissioner of Customs Kolkata.	1.33
		Construction of Hostel building for accommodation of Dog handlers at Customs Canine Centre, Attari, Amritsar by Directorate of Logistics, New Delhi through the Commissioner of Customs (P), Amritsar.	3.67
		Setting up of Cyber Lab by ADG Admin, NACIN, Faridabad.	0.49
		Purchase of 1400 Laptops for Group –‘A’ Officers under CBIC by Directorate of Logistics	0.12
4	2020-21	Consolidated proposals for special equipment and winter clothing	0.07
		Infrastructure related proposals at CCC Attari	0.23
5	2021-22	845 laptops for Group A under procurement	0.08
		2118 laptops for Group B under procurement	20
		First Level Committee in Sept 2021 further recommended proposal worth Rs. 6.67 crores and the meeting Second Level Committee is planned in Dec 2021	6.67

4. On request of Directorate of Logistics, the TRU, CBIC provided data for incremental revenue for respective FYs, which is as follows –

(Amount in Crores)

S.No.	FY (A)	B.E. (B)	Actual Realisation (C)	C-B	Due for 1% Incremental Revenue Scheme
1	2011-12	397816	392444	-5372	NIL
2	2012-13	505044	474482	-30562	NIL
3	2013-14	565003	497061	-67942	NIL
4	2014-15	624902	544157	-80745	NIL
5	2015-16	647918.54	709825.14	61906.6	619.066
6	2016-17	779669.50	861963.49	82293.99	822.9399
7	2017-18	245000.00	332291.32	87291.32	872.9132
8	2018-19	716400.00	575346.86	-141053.14	NIL
9	2019-20	681904.00	603241.84	-78662.16	NIL
Total					2314.9191

4.1 Accordingly, Directorate of Logistics, calculated the amount Rs.2314.91 crore which is due to CBIC under the 1% Incremental Revenue Scheme for the period 2011-12 to 2019-20 and sent a request to DGHRD on 31.12.2020 for provisioning the amount under 1% Scheme. In reply of the DoL letter dated 31.12.2020, DGHRD directed that DoL will deal the matter directly.

5. Action Plan for FY 2021-2022

A. DoL would put in all efforts for full utilisation of funds during FY 2021-22 for enhancing organisational efficiency, infrastructure and wherewithal. The proposal to procure 845 laptops at an estimated expenditure of Rs. 7.88 Cr. for rest of the Group A officers has been approved and the procurement process for the same is being completed out of the funds allocated in FY 2021-22. Hon. FM has approved the policy for provisioning of laptops for Group B officers of the CBIC as well and a sanction has been granted for procurement of 9271 laptops at an estimated expenditure of Rs. 74.17 crores. Accordingly, a bid for procurement of 2118 nos. of Laptops at an estimated expenditure of Rs. 20 Cr. for Gr. B officers was floated on GeM portal on 10.12.2021.

DoL is already in receipt of some proposals from CBIC formations like Special clothing, Bullet Proof Jackets/ Helmets, Night Vision Binoculars, Search Light/ Focus Lights, Motor Cycles/ Motor Vehicles, Handheld Backscatters, Walk through Metal Detectors/ scanners etc. First Level Committee in Sept 2021 further recommended proposal worth Rs. 6.67 crores and the meeting Second Level Committee is planned in Dec 2021.

B. Follow up on due amount under the 1% Incremental revenue Scheme after FY 2011-12

CBIC has received the amount equal to 1% of the incremental revenue till the FY 2011-12 only under the 1% Incremental revenue Scheme as there was no incremental revenue during the FYs 2011-12 to 2014-15. CBIC has till date not received additional funds under 1% incremental revenue scheme after the F.Y. 2011-12. During the financial years 2015-16; 2016-17 & 2017-18, the revenue collection by CBIC under Indirect Taxes exceeded the budget estimates by Rs. 61906.6 crores; Rs. 82293.99 crores; & Rs. 87291.32crores respectively. Therefore, 1% i.e. Rs. 2314.91 crores is due to be earmarked under 1% incremental scheme to the CBIC. Accordingly, Directorate of Logistics, calculated the amount Rs. 2314.91 crore which is due to CBIC under the 1% Incremental Revenue Scheme for the period 2011-12 to 2019-20 and sent a request to DGHRD on 31.12.2020 for provisioning the amount under 1% Scheme. In response DGHRD vide letter dated 3rd Dec 2021 directed that DoL should take up the matter directly with IFU. DoL would Follow up on due amount under the 1% Incremental revenue Scheme after FY 2011-12 during the current FY.