PMC takes legal action in cases of bad cheques submitted for property tax

The Pune Municipal Corporation (PMC) has begun taking legal action on property tax holders whose cheque bounced while paying property taxes

The Pune Municipal Corporation (PMC) has begun taking legal action on property tax holders whose cheque bounced while paying property taxes. Till date, the PMC has sent legal notices to around 200 property tax holders.

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According to tax department officials, every year there are 2,500-3,000 cases of check bounce. However, the department was not taking any serious cognizance. However, the property tax department has decided to take strict action on cheque bounce cases this year.

The PMC legal department has sent notices under Section 138 of the Negotiation Instruments Act to 600 property holders whose cheque bounced for the year of 2019-20.

Section 138 is dishonoured for insufficiency of funds or any of the prescribed reasons; the one who defaults can be punished with imprisonment for a term which may extend to two years or with fine which may extend to twice the amount of the cheque or both.

After sending notices, some of the property tax holders paid around ₹5 crore of the amount. The PMC will wait for one month after sending the notices of cheque bounces before filing a case in court.

Till date, the PMC legal department has filed four such cases against property tax defaulters.

Vilas Kanade, head of property tax department said, “We have started sending legal notices from 2019-20. However, for the first time, we filed cases in court in 2020-21. We found that after notices, people are paying tax to PMC. All defaulters are from the 2019-20 financial year especially in the month of February and March-2021.”

According to PMC property tax statistics, the civic body collected ₹1,664.15 crore in revenue in 2020-21 of which, the PMC received ₹828.08 crore through online payments.

The amount collected from cheque and demand draft is ₹653.32 crore. Due to the Covid-19 pandemic, citizens made a maximum number of online transactions. A total of ₹182.74 crore was paid by cash.

The PMC tax department collected a revenue of ₹1,665 crore in 2020-21 against the set target or ₹2,320 crore. According to the PMC tax officials, the collected amount is ₹400 crore more in comparison to the last year’s (2019-20) tax collection. It is an achievement of the PMC during the Covid-19 situation as compared to all municipal corporations in the state.

In 2019-20, the PMC set a target of ₹2,320 crore and collected ₹1,262 crore. Now, the PMC property tax department set a target of ₹2,650 crore for 2021-21 financial year.

PMC municipal commissioner Vikram Kumar mentioned in the annual budget-2021-22 speech that property tax has emerged as the largest revenue source for the PMC and is expected to continue further as properties from newly merged 23 villages will come under the PMC tax ambit and result in increasing tax collection.

The city has 10.81 lakh properties including 11 newly merged villages. Of that, nearly 12.5 per cent are commercial and more than 12.5 per cent are residential. There are 3.5 per cent properties that have an open plot. There are two per cent of properties which are a mix of commercial and residential establishments.

Normally, the PMC prepares and distributes property tax bills in the month of April every year. The PMC gives the May 31 deadline to pay bills in which the civic body gives a 5-10 percent discount on the bill. After the month of July, the PMC starts applying a 2 per cent fine for late payment on bills.

The PMC gives multiple options such as to pay tax in Citizen Facilitation Centre (CFC) and in banks through cheque, cash and DD. Besides that, the civic body also provides an online option to pay tax. The PMC had also introduced doorstep option to pay property tax in 2019-20. However, it got a very poor response.

Normally, the PMC prepares and distributes property tax bills in the month of April every year. The PMC lists May 31 as the deadline to pay bills in which the civic body offers a 5-10 percent discount on the bill. After the month of July, the PMC starts applying 2 per cent fine for late payment on bills.

The PMC has given multiple options to pay tax such as the Citizen Facilitation Centre (CFC), in banks, cheque, cash and DD. Besides that, the PMC has also provided an online option to pay tax.