Revenue is first deposited in consolidated fund, AP tells HC

 Vijayawada: The state government informed the High Court that its revenue in the form of taxes is being deposited in the consolidated fund initially before diverting it to AP State Development Corporation.

A division bench, comprising Chief Justice A. K. Goswami and Justice N. Jayasurya heard a petition on Thursday, filed by Telugu Desam MLA Velagapudi Ramakrishna Babu stating that the state’s revenue was being diverted to APSDC by-passing the consolidated fund.

The petitioner’s counsel Basava Prabhu Patil argued that the state government was diverting state’s income to APSDC without depositing it into consolidated fund and urged the court to annul Sections 12 (1)(4)(5) of APSDC.

State government’s counsel Dushyant Dave argued that the petition was filed with s political motive and submitted that the state government was initially depositing its revenue in consolidated fund and later diverting it to APSDC.

However, when petitioner's counsel sought time to file an affidavit with more details, the court adjourned the case for next hearing to September 7.

In a related development, the bench heard another petition filed by Vijayawada-based K. Himabindu with a plea to annul sections 3 (3) and 4 of APSDC Act, 2020 with a provision to allow the state government to raise a loan to APSDC.

The petitioner’s counsel B. Nalin Kumar argued that the state government violated RBI Act Section 45 IA (1)(A) by not getting registration certificate for APSDC as a non-banking financial company. He pointed out that AP did not obtain permission from the Centre to raise a loan beyond the permitted limit as per Article 293 (3) and argued that the state government was not implementing AP Fiscal Responsibility and Budget Management norms.

However, state government’s counsel Dushyant Dave raised objection over the delay in filing such a petition and said that it would be inappropriate to file a petition when one on APSDC was already filed.