Commercial Taxes

Maharashtra Sales Tax Department Automation

Background

The e-Governance Roadmap of the state of Maharashtra identifies several priority sectors as mission mode projects (MMPs) under The National e-Governance Plan (NeGP),, which would provide efficient services to the citizens & businesses and enhance the internal efficiency of the Government. The department of Sales tax, Maharashtra, was considered to be one of priority departments.

The Government of Maharashtra had taken the initiative and moved ahead with the automation of the department and had introduced function based organisational structure, outsourcing of the IT and the non-core processes, introduction of process re-engineering, citizen centric services and the automated backend processing application.

Brief Details / Summary:

Vendor for Infrastructure and Outsourcing:

In the month of April 2004, Government of Maharashtra floated an open tender for selection of a vendor for creation of the IT infrastructure, hosting of the application and maintaining the entire application and IT infrastructure. Some of the non core activities like digitization of the registration and returns data, training, helpdesk were allowed to be outsourced by the vendor. In the year 2007, consortium of M/s. ECIL and M/s. Terasoft Pvt. Ltd was selected through the tender process for providing services as per the scope of the tender. The project was awarded on Build Own Operate Refresh (BOOR) for the duration of 5 years ending March 2012. The existing contract was extended for a period of 12 months till March 2013.

The scope of work of M/s. ECIL and M/s. Terasoft Pvt. Ltd consortium was:
  • Creation & maintenance of IT infrastructure at PDC, DR site and maintenance of Mahavikas & Mahavat applications
  • Outsourcing of digitization service and helpdesk management
  • Training of the departmental officials
  • Development & maintenance of Mahavat portal for dealers with e-Services introduced as e-Registration, e-Returns, e-CST, e-Payment, e-704 and e-Refund.

Vendor for Application Development:

In year 2001 M/s. Mastek through a national open tender was awarded the project for development and maintenance of Mahavikas application for automation of departmental functions. There were major changes carried out post introduction of VAT with various modules being developed and modified over the project timeframe.

The modules being developed are as follows: Administration, Registration, Returns, Advisory Visit, Assessment, Recovery, Business Audit, Refund, Investigation/Enforcement, Central Repository, Complaints, Dealer Accounting System, PSI, EIU, Appeals/Legal/Tribunal, Grievances, Professional Tax, DDQ and e-704.

Mastek continues to be the Mahavikas development vendor for carrying out ongoing enhancements and provide Maintenance and Support to the Mahavikas system.

Project Consultant:

PricewaterhouseCoopers Pvt Ltd (PwC) was selected through a Global open tender for providing VAT implementation consultancy to Government of Maharashtra. PwC was awarded the contract for Development of Outsourcing model, Information System Security Policy, Bid Process Management and project management support for the implementation of IT hardware. The current contract is an extension of it with scope as project management, project audit, vendor management and vendor contract preparation and re-negotiation.

The project was sanctioned by the govt. of India under the MMP-CT on 26th March 2010 for Rs 143.69 Crores with the share of the Central Government at INR 100.19 Crores and the State’s share at INR 43.5 Crores.

Scope of the program/project/initiative:

The scope of the MSTD Automation project is as follows:
  • Introduction of the new system of tax administration namely Value Added Tax system with effect from April 1st, 2005. This introduced the multi point multi stage of levy, rebate of full input tax credit and functional system with functions as Registration, Central Repository, Returns, Business Audit, Large Tax Payers Unit, Refund, Cross Check, Assessment, Recovery, Investigation, Appeals, Survey, Economic Intelligence Unit and Public Grievance.
  • Citizen centric services for an efficient service delivery mechanism to the citizens. Citizen facing processes being re-engineered and introduced as e-services are Registration of dealers, Collection of returns, Collection of taxes, Provision of refunds, Tax accounting services, Issue of statutory forms pertaining to inter-state and intra-state trade and Information services, taxpayer education and guidance
  • It is a Completely Centralized Automation System with Application software installed on the Central Server, with all locations connected by LAN & WAN with the central server, secured by Firewalls & Intrusion Prevention Software (IPS)

Benefits of the program/project/initiative to dept./citizens etc.

Benefits

  • To provide the following to citizens:
    • Single window interface
    • Anytime anywhere request
    • Multiple delivery channels
    • Grievance handling
  • Transparent processes
  • Radical improvement in turn-around time
  • Improvement in internal efficiency and capacity development
  • Improvements in Service Levels
  • Eradicate non-value adding processes from the system
  • Suggest ICT interventions to counter the challenges confronting the department and enhance service delivery standards
  • Enable the department to utilize, avail and harness a Robust Connectivity Backbone post implementation of SWAN
  • Centralized Storage of Data leveraging the State Data Center
  • Enhancement and up-gradation of the current applications
  • All functional branches to be computerized and networked, for paperless government.
  • Built a data base for analysis using intelligence tools.
  • Have a complete electronic interface with the dealers.
  • Provide dealers with the required information and interaction with the department electronically.
  • To have a data exchange system with other departments & the other states.
  • Computerized dealer grievance redressal system.
  • Digital billing networked with department.
  • Electronic Border Check Post linked with departmental automation.
  • Build interfaces with other departments for seamless information exchange
  • Enable the department to have clear visibility across levels for informed decision making

Present Status

The current BOOR project which was awarded to the consortium of M/s. ECIL and M/s. Terasoft Pvt. Ltd was selected through the tender process for providing services as per the scope of the tender. The project was for the duration of 5 years which ended in March 2012. The existing contract was extended for a period of 12 months till March 2013. The existing BOOR contract has a provision for renegotiation with the existing vendor at the end of contractual period and undertakes a complete renewal of the IT infrastructure and application. As per the contractual provision, ECIL has expressed their interest in continuing their services and MSTD would like to consider the re-negotiation process with ECIL with an enhanced scope of work and new terms & conditions.

Future Plan

The existing infrastructure is at its end of life and hence requires a complete overhaul. Also there is a demand from the departmental and external users for a more efficient, scalable and better performing application. An audit of the core application architecture, design and security was performed; along with it the project operational issues were assessed based on the last 5 yrs of experience. Based on this assessment, a new scope for the renegotiation with ECIL has been prepared, to be shared with them after the in principal approval of the renegotiation process by HPC very soon.

Timelines (When did it start, when did it end etc.)

Project started with selection of MASTEK for developing the intranet (MAHAVIKAS) application in 2001. For the portal services (MAHAVAT) ECIL consortium was selected in 2007 for Procuring, Managing the Infrastructure on BOOR basis for a period of 5 years and developing and maintaining the internet portal.

Cost savings arising out of it

  • Caught 1277 Hawala operators – 37,000 beneficiaries, tax involved Rs. 1200 Crores
  • Eliminated about 3000 visits daily to Sales Tax Offices by introducing e-Services
  • Audit/Assessments by exception
  • Faster communication with dealers through SMS, e-mail

Awards won

  • EDGE AWARD for "Best IT implementation in India"
  • CXO AWARD 2010-The IT Chapter for "IT innovative in the Government"
  • CSI-NIHILENT E-GOVERNANCE AWARDS 2009-10 - APPRECIATION AWARD UNDER DEPARTMENT CATEGORY for e-Governance Initiative in Department of Sales Tax