Ludhiana MC carries out inspections at hospitals to check for property tax evasion

Suspecting tax evasion by hospitals, Aam Aadmi Party (AAP) MLA Gurpreet Gogi had raised the issue during the Ludhiana MC’s General House meeting held on March 28. The House then directed the MC to scrutinise property tax returns of city hospitals

After serving notices to 139 city hospitals to submit the property tax returns filed since 2013-14, the municipal corporation (MC) has now commenced cross checking of the returns, through site inspection, to check for tax evasion.

A Ludhiana MC official, requesting anonymity, said hospitals have not been filing tax returns as per the norms and many have given certain portions of their premises on rent, but are still filing the returns under the non-residential category to evade tax. (HT FILE)

Officials said the staff checks the covered area, number of floors in the building during the site inspections. The information collected is then matched with the details of tax returns submitted by hospitals with the MC.

A 100% penalty is imposed to violators who are caught evading property tax, which is submitted on a self-assessment basis.

Suspecting tax evasion by hospitals, Aam Aadmi Party (AAP) MLA Gurpreet Gogi had raised the issue during the civic body’s General House meeting held on March 28. The House then directed the MC to scrutinise property tax returns of city hospitals.

An MC official, requesting anonymity, said hospitals have not been filing tax returns as per the norms and many have given certain portions of their premises on rent, but are still filing the returns under the non-residential category to evade tax. Building owners have to pay ₹6 per feet tax for the ground floor and ₹3 per feet for others. However, the tax is 7.5% of the annual rent in case the building is given on rent.

A hospital owner had submitted over ₹11 lakh with the department after being served a notice by the civic body, but a detailed report regarding violators is yet to be compiled.

Hospitals’ management have shown little cooperation with the MC teams and higher authorities have been apprised about the same. The focus of the department, until this point, has been on the areas falling under MC’s Zone D and returns of other hospitals will be scrutinised in the coming days, the official added.

MC zonal commissioner Jasdev Sekhon said he has directed property tax wing officials to complete cross checking in hospitals and submit a report by April 30. Penalties will be imposed on the violators if caught evading tax in the past.