Official urged to take remedial action for recovering dues

The tax evasion is to the extent of Rs. 13.5 crore

Scrutiny of rice mill invoices conducted in a few districts

HYDERABAD: Tax liability in the form of rural development cess (RDC) to the extent of Rs. 13.5 crore was detected by sleuths of Vigilance and Enforcement wing during scrutiny of taxable turnover of rice mills from April 2005 to the end of August this year in several districts in the State.

This was only a sample study though fairly widespread. The actual liability could be much higher, as there were hundreds of rice mills in the State, official sources said. Scrutiny of the invoices of rice mills was conducted in Srikakulam, Vizianagaram, EG, WG, Krishna, Guntur, Nellore, Kurnool, Nizamabad, Medak, Karimnagar and Khammam districts.

The sources said the millers were required to include RDC component (four per cent) in the taxable turnover. Under Section (2) of the AP VAT Act, definition of the sale price is the total amount set out in the tax invoice. The millers were supposed to charge RDC while selling rice to the FCI. Normally, four per cent RDC should have been included in the sale price.

It was stated that the millers had flouted the tax rules by failing to include RDC although the Commissioner, Commercial Taxes, had sent a circular stating that RDC, agricultural market cess and freight charges paid by the FCI to the millers formed part of taxable turnover.

The department sent a report to the Principal Secretary (Revenue) to take remedial action for recovering the due amount.