Q2 · UPSC current affairs · 9 September 2026 · News · PAC Report Non-Transfer of Cess Proceeds Reserve Funds

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What was the primary concern recently raised by the Public Accounts Committee (PAC) regarding cess proceeds?

A Transfer of collected cesses directly to the NITI Aayog for infrastructure development.
B Non-transfer of collected cesses to their designated non-lapsable reserve funds, keeping them in the Consolidated Fund of India to reduce the accounting fiscal deficit.
C Diversion of cess funds exclusively towards foreign debt servicing under RBI supervision.
D Exemption of major corporate entities from paying statutory cesses.

Correct answer: (b) Non-transfer of collected cesses to their designated non-lapsable reserve funds, keeping them in the Consolidated Fund of India to reduce the accounting fiscal deficit.

Explanation

The PAC flagged the non-transfer of ₹9,222 crore in collected cesses to their designated non-lapsable reserve funds, criticizing the practice of retaining these proceeds within the Consolidated Fund of India to artificially reduce the fiscal deficit. Options A, C, and D do not reflect the committee's findings.

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