Making a strong case against the Reserve Bank of India’s “unauthorised deduction” of Rs.1,274.21 crore from the State’s account, Telangana IT Minister K.T. Rama Rao on Saturday appealed to Union Finance Minister Arun Jaitley to direct the bank to return the money
Mr.Rao who called on the Union Minister in New Delhi on Saturday said the bank’s action on instructions of the Income Tax Department was causing acute financial crisis to the Telangana government.
Mr.Rao, deputising for Finance Minister Etala Rajender who recently met with an accident, said prior to bifurcation of AP, the I-T Department had assessed APBCL, a State agency engaged in wholesale trading of IMFL. It had initiated proceedings claiming Rs.2,939.53 crore for the assessment years 2012-13 and 2013-14.
After the bifurcation, the APBCL figured in the list of entities whose assets and liabilities had to be apportioned and the corporations demerged. The process was under consideration of an expert committee, he said.
On May 30 last year when Telangana State Beverages Corporation Ltd (TSBCL) was formed, the I-T department issued attachment and prohibitory proceedings against TSBCL for tax liability of APBCL for assessment year 2012-13 stating it is a successor organisation.
When TSBCL approached the High Court at Hyderabad, the court allowed the writ petition and declared the recovery proceedings by the Tax Recovery Officer as illegal. The Tax Officer on May 18 this year intimated directions of the High Court and requested for payment of tax but a notice as directed by the Court was not issued either to TSBCL or the State government.
A notice was, however, issued to the RBI on June 19 for depositing Rs.1,274.21 crore in favour of Income Tax Department from the principal account of Telangana. A copy of the notice to RBI was received by the State government on June 24. Consequently, CGM, RBI at Nagpur, had paid the amount “without any notice of intimation to the State.”
‘The deduction of
Rs. 1,274.21 crore from the State’s account is unauthorised and it is causing financial crisis in the State’
