Major Flaws in Odisha's Transport System Revealed by CAG Audit

A recent audit by the Comptroller and Auditor General (CAG) of India has unveiled significant flaws in Odisha's transport system, revealing that 39.55 lakh e-challans worth Rs 1,136.62 crore are pending. The report highlights failures in enforcing motor vehicle laws, collecting taxes, and ensuring vehicle safety compliance. Alarmingly, fines totaling Rs 640.87 crore were not imposed due to incomplete recording of violations. The audit also points to the lack of regulatory mechanisms for aggregator services and issues with the installation of high-security registration plates. These findings raise serious concerns about the effectiveness of the state's transport regulatory framework.

By Narendra Chaudhary Sep 29, 2026, 09:19 IST

Audit Uncovers Serious Issues in Transport Authority Operations

ARINDAM GANGULY, OP

Bhubaneswar: A staggering 39.55 lakh e-challans, totaling Rs 1,136.62 crore, remain unresolved with regional transport offices (RTOs), courts, or police authorities. This alarming situation was highlighted in a recent report by the Comptroller and Auditor General (CAG) of India, which also noted that enforcement officials neglected to impose fines amounting to Rs 640.87 crore for various motor vehicle violations.

The CAG's Subject Specific Compliance Audit Report, focusing on the operations of the State Transport Authority and RTOs in Odisha from 2019-20 to 2023-24, revealed significant shortcomings in traffic law enforcement, tax collection, vehicle safety compliance, and permit management. These findings raise serious questions about the efficiency of the state's transport regulatory framework.

The audit indicated that the backlog of 39.55 lakh e-challans has allowed vehicles to operate without paying necessary taxes and penalties. Furthermore, it was noted that enforcement officials frequently recorded only one or two violations, even when multiple infractions were evident.

"The incomplete recording of offences led to the failure to collect fines totaling Rs 640.87 crore," the report stated. This highlights critical deficiencies in enforcing motor vehicle regulations and collecting penalties from offenders. The CAG also criticized the department's efforts in recovering outstanding motor vehicle taxes, revealing that only Rs 9.71 crore, or 1.83%, of the targeted Rs 530 crore had been collected as of August 2024.

Additionally, the audit uncovered cases of inadequate tax levies and non-levies on stage carriage permits. In 75 instances, taxes totaling Rs 30.23 lakh were either not charged or collected at lower rates than required, with a potential penalty of Rs 60.45 lakh applicable for unpaid taxes. In another 30 cases, ordinary permits were issued instead of express permits for stage carriages, resulting in a tax loss of Rs 14.59 lakh.

The report also pointed out the lack of a robust regulatory framework for aggregator services, allowing them to operate without licenses and set fares arbitrarily. Inconsistencies in the collection of one-time taxes on vehicle sales were noted due to the absence of a fixed base price for tax calculations. The CAG found that the department accepted motor vehicle taxes without verifying that vehicles had valid fitness certificates (FCs) in the VAHAN system, violating the Motor Vehicles Act.

As a result, inspection fees of Rs 73.18 lakh from 9,760 vehicles could not be collected. The report further criticized the registration of public service vehicles without ensuring the mandatory installation of vehicle location-tracking devices and emergency buttons, which jeopardizes the safety of women passengers. Moreover, the department failed to ensure that high-security registration plates (HSRPs) were installed on 17.61 lakh vehicles registered before March 2019, and an additional 1.52 lakh vehicles were registered without HSRPs up to March 31, 2024.