CAG Audit Exposes Financial Strain on Ghaziabad Development Authority
A recent report by the Comptroller and Auditor General of India has brought to light a significant financial issue plaguing the Ghaziabad Development Authority. The audit reveals how the Uttar Pradesh government's failure to transfer a crucial 2% infrastructure cess, collected through stamp duty from property buyers, has severely hampered GDA's financial health for several years.
Mounting Dues and Revenue Shortfalls
The CAG report details that between 2017 and 2022, GDA formally raised demands totaling Rs 317 crore from the state government for its rightful share of the infrastructure cess. However, with these funds remaining unreleased, the outstanding amount ballooned to a staggering Rs 585 crore by September 2023. The audit body has explicitly recommended that the state government "unfreeze" these funds to alleviate the financial pressure on the development authority.
Directly linking the pending cess payments to GDA's precarious revenue position, the CAG observed a consistent pattern of shortfalls. Except for the financial year 2018-19, GDA's revenue during the 2017-22 period was consistently lower, ranging from 48% to 58% below expectations. The report identifies the non-release of the infrastructure fund, described as a major revenue source, as a primary contributor to this financial weakness.
Official Confirmation and Recent Policy Shift
A senior GDA official confirmed the accumulation of these substantial dues. "It is accurate that until September 2023, the amount owed by the state government to GDA had escalated to Rs 585 crore," the official stated.
The official further explained that a policy decision initiated a turning point. "In August 2024, the UP state cabinet approved a proposal to transfer the infrastructure cess directly to development authorities and civic bodies. Since the beginning of 2025, we have received a significant portion of the previously held-up infrastructure fund. Currently, a little over Rs 43 crore remains pending with the state government," the official added, indicating a partial resolution to the long-standing issue.
Legal Challenges and Historical Context
The dispute over these funds had previously escalated to the judiciary. After repeated appeals by the Ghaziabad Development Authority and the Ghaziabad Municipal Corporation failed to produce results, a former councillor filed a Public Interest Litigation in the Allahabad High Court in 2022. The PIL argued that the withholding of funds was directly impeding development work within the city.
The infrastructure fund is considered one of the main revenue streams for agencies like GDA, alongside internal receipts such as house tax, sewer tax, mutation charges, and property rents. These funds are earmarked specifically for urban development projects and civic works.
The root of the issue traces back to a 2013 policy change. During that period, the then Samajwadi Party government amended the rules, directing that the cess collected would first be routed into the state exchequer before being released later to the concerned civic agencies, a process that ultimately led to the delays and financial bottlenecks highlighted in the CAG report.
