KOLKATA: Kolkata Municipal Corporation’s (KMC) property tax collection, which soared immediately after the demonetisation, has shown a drastic fall in the second fortnight post the scrapping of Rs 500 and Rs 1,000 notes on November 8. Against Rs 73 crore in the first fortnight (November 11 to November 24), tax deposits dwindled to Rs 24 crore between November 25 and December 10.
The collection dropped in the wake of the PMO and central agencies — namely income tax and CAG — starting inquiring into huge tax deposits. The I-T department has asked for the assessee numbers of top money depositors to inquire if I-T returns of the companies or the individuals justify such tax deposits in old currency notes.
KMC had mopped up Rs 97 crore in last one month, only Rs 3 crore less than the Rs 100-crore property tax collected under the waiver scheme in entire 2015. Taking stock of the situation, the KMC had fixed the property tax target at Rs 900 crore in 2016-17, which comes to an average monthly target of Rs 75 crore. According to KMC assessment department sources, the department had a shortfall of Rs 21 crore a month against the monthly target for three months — August, September and October. The windfall in November helped the cash-strapped civic body make up for the monthly property tax deficit to a considerable extent.
A source in the assessment department conceded that the civic body had collected more than Rs 40 crore from major defaulters who paid in the range of Rs 25 lakh to Rs 1 crore in old currency notes. According to KMC rules, a property tax payer can’t pay more than Rs 25000 in cash at the civic treasury counters. However, a tax payer or a defaulter can pay amount in cash to the assessment department. This amount is then shown in the suspense account of the tax payers or defaulters concerned, which could later be adjusted against their dues.
“This rule has perhaps encouraged a section of defaulters to clear their dues in scrapped notes that they had in large numbers. We collected those in the past few days and sent those to designated banks,” said a KMC revenue department official.
According to a KMC assessment department source, some of the major defaulters who had refused to take advantage of two successive waiver schemes queued up this time at the KMC assessment department offices and paid hefty amounts in cash. In fact, assessment department officials had to stay back in office till late at night to manage the rush.
“It was really tiring. Like bank officials, we too stayed back at office till late at night. During the first fortnight, the number of tax payers depositing cash in old notes increased by the hour, thus making it an uphill task for us,” said a KMC revenue department employee.
Credits ET Realty