Improvement trust’s tax dues a matter of worry for MC
The improvement trust’s income-tax arrears spell trouble for the Patiala municipal corporation (PMC) as the income tax (IT) department is now eyeing the corporation’s exchequer to collect dues from the trust.punjab Updated: Jun 24, 2014 12:04 IST
The improvement trust’s income-tax arrears spell trouble for the Patiala municipal corporation (PMC) as the income tax (IT) department is now eyeing the corporation’s exchequer to collect dues from the trust.
The I-T department has summoned the PMC authorities to present last two years’ financial records and bank accounts of the body.
The PMC borrowed Rs 25 crore from the trust, of which it has repaid Rs 16.5 crore. However, the improvement trust failed to clear I-T dues of over Rs 13 crores, due to shortage of funds.
In a written communication, income tax officer RD Goel directed PMC authorities to appear before them on June 25 with details of the PMC’s bank for financial years 2012-13 and 2013-14 and the current status of its exchequer. The I-T department also sought information about the loan borrowed from the trust in 2011.
A senior official from the PMC revealed that the I-T department’s move followed the improvement trust’s declaration of their inability to repay tax arrears, in spite of repeated notices.
“Income tax department has to recover the money at any cost. So, the I-T department has resorted to pressure by summoning the PMC authorities as the latter owed more than Rs 8 crore to the improvement trust,”said an PMC official.
Meanwhile, senior officials at the PMC were on their toes preparing for their appearance before I-T officials, throughout Monday.
In spite of selling properties under its jurisdiction, over the years, that fetched the body huge incomes, the improvement trust failed to deposit tax.
The trust originally owed Rs 21 crore in tax, out of which it managed to pay RS 8 crore.
The trust challenged the remaining amount of Rs 13 crore before the Income Tax Appellate Tribunal which failed to provide any relief.
Following this, the I-T department froze the trust’s bank accounts on January 3 after which they have not been reopened till date.
Joint commissioner of PMC Nazar Singh, who is officiating as the chief of the corporation, said they consulted with their finance department to prepare a reply to be presented before the I-T officials.
“We will present our case about before the I-T department. The experts have been put on the task to prepare a reply in the matter,”he said.