"Pagri" charged by Government servants in renting their houses and flats – amounts to corruption

(14) "Pagri" charged by Government servants in renting their houses and flats – amounts to corruption

Recommendation No. 32, contained in para 6.19 of the Report of the Committee on Prevention of Corruption reads as follows :-

32. To buy and sell properties at prices much greater than those recorded in the conveyance deeds has become a common method of cheating the Central Government of the income-tax and other taxes and the State Government of the stamp duty and a convenient methods of transferring black money. If, in some manner, the Central and State Governments, or some special corporations setup for the purpose, can be empowered to step in and acquire such properties at the stated value, or even at a small premium when it is considered that the properties have been deliberately undervalued, it will strike a blow against black money.

The habit of charging "pagri" or "premium" for renting houses and flats in a similar sources of corruption for which some drastic steps have to be taken."

2. This recommendation has been considered carefully in the light of the comments received from Ministries/Departments etc., Government of India’s decision on the recommendations is as follows :-

The changes made in the Income Tax Act 1964 substantially achieve the purpose underlying a part of the recommendation Government are, however, advised on legal and constitutional grounds that it would not be possible to accept the part of the recommendation regarding the setting up of special corporations for the acquisition of such properties.

As regards the part of the recommendation relating to "pagri" the State Governments have been requested to take appropriate action in the matter.

[MHA OM No. 43/49/64-AVD, dated 19.11.1965]