The irregularity involving wrong declaration of doctors as professionals rather than employees, by hospitals to evade tax is turning out to be bigger than expected.
The tax deducted at source (TDS) wing of the income tax (I-T) department continued its survey on Monday and covered six more prominent private hospitals to study the payment details of around 600 doctors.
The tax evasion suspected by the department has gone up to more than Rs 45 crore.
"It could be more as we are still in the process of going through documents," a senior I-T official said.
The authorities had found that many city hospitals were declaring doctors employed by them as professionals to evade TDS payment.
According to I-T officials, if a doctor is shown as an employee, then TDS at the rate of 33 per cent is required to be deducted and paid to the I-T department. However, if the hospitals show that they have engaged doctors as professionals, then TDS is deducted at the rate of only 10 per cent.
On Thursday, the authorities had conducted survey on six hospitals and studied payment details of around 1,000 doctors. From that survey, the officials suspect that the evasion could be around Rs 25 crore. From Monday's survey, the officials suspect that evasion by another set of six hospitals could be over Rs 20 crore.
The team, comprising 70 officials and staff of the department, took copies of computer records and account details which had information on payments made to the doctors.
Once established that the hospitals evaded TDS payment, the I-T department can levy a penal interest of 15 per cent per annum on the amount. Also, a penalty of 50 per cent can be levied.