Bounced cheques plague GHMC’s property tax collection

Dues are still pending from 2,928 defaulters whose cheques amounting to ₹ 34 crore had bounced

There is a deficit of over ₹ 130 crore in tax collection compared to previous financial year.

The Greater Hyderabad Municipal Corporation (GHMC) is facing an unusual problem of bounced cheques in relation to collection of property tax this year.

A large number of cheques issued in property tax payment have bounced when submitted for realisation since April, 2021, worsening the financial condition of the civic body which is already under severe stress. As a result, the property tax collection has been below par thus far, keeping the authorities on tenterhooks. Ultimatums have been issued to the circle level officials to improve the collection or face action.

According to information obtained from the GHMC, there is a deficit of over ₹ 130 crore in the tax collection when compared with the collections up to January 31 during the previous financial year.

Last year, up to January-end, GHMC collected a revenue of close to ₹ 1,270 crore through property tax, while this year, till now, the revenue has not crossed ₹ 1,140 crore, even while the number of properties assessed are higher than previous year by about 70,000.

One reason for the anomaly is said to be poor collection of tax from the newly assessed properties. While the number of new assessments hovers around 59,000, only about 56 per cent of the dues have been realised, as per data obtained. It is especially poor in circles such as Chandanagar, Amberpet, LB Nagar, Alwal, Moosapet, Kukatpally, and Ramachandrapuram, for reasons not known.

Increasing number of bounced cheques is another factor behind the poor tax collection. Of the total cheques issued to the corporation this financial year, 8,719 cheques have failed when submitted for realisation.

In 5,791 instances of bounced cheques, tax has been collected subsequently, which amounted to close to Rs. 45 crore. Dues are still pending from 2,928 defaulters whose cheques amounting to ₹ 34 crore had bounced.

Goshamahal leads in bounced cheques, with a total of 665 bad cheques, of which 380 are still pending. Kukatpally follows at 621, of which 267 are yet to be realised.

Officials under the condition of anonymity, blame the bounced cheques on the COVID-19 affected economy, and a large number of properties remaining vacant due to the pandemic.

Nevertheless, deputy commissioners of all the circles received a rap on their knuckles for failing to meet the targets. An internal communique from the GHMC Commissioner warned them of disciplinary action if they fail to reduce the deficit to zero by January end.

According to confidential sources, DCs of six poor performing circles have been threatened with removal from the position, if they fail to deliver.