Out-of-court deal fetches State Rs 40 cr from Mint compound

All possible ways are being adopted to realise some of the very old tax dues without taking recourse to harsh methods, and the decision seems to be yielding big results.

By Author  |  Published: 25th Mar 2019  12:50 am

Hyderabad: Telangana seems to be going strictly by the doctrine of Adam Smith who advocated “Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism… ”

All possible ways are being adopted to realise some of the very old tax dues without taking recourse to harsh methods, and the decision seems to be yielding big results. Thanks to the special focus on the public sector undertakings that owed big money to the State, the tax collection is on the desired lines today.

A decade-old legal wrangle between State government and the India Government Mint (Hyderabad) of the Security Printing and Minting Corporation of India Ltd (SPMCIL) was resolved two days ago on a happy note making the State exchequer richer by Rs 40 crore.

This amount is being paid by SPMCIL towards Value Added Tax (VAT) dues on the coins being minted by the SPMCIL in Hyderabad. Interestingly, the SPMIL came forward to clear the due only after the minting coins were exempted from tax net under the new tax regime.

It is classified neither as a good nor as a commodity for sale and hence it would not attract any tax liability. The decade-old legal battle was resolved by opting for an out-of-court deal by adopting one-time settlement provisions. Some relief was given to the SPMCIL, said Somesh Kumar, Principal Secretary (Commercial Taxes and Excise).

He pursued the case personally with the SPMCIL officials, who contested it all in the court, had negotiations with them and got the cheque delivered finally for the said amount. There are some six to seven big public sector undertakings owing huge VAT dues to the State.

He said the state could resolve the tax dues issue with petroleum companies operating in the State, and they had come forward to clear dues worth Rs 60 crore.

Telangana Southern Power Distribution Company Limited (SPDCL) is ready to clear Rs 40 crore. Telangana Foods will be paying Rs 11 crore. It was found that Mahindra and Mahindra owed the State government about Rs 57 crore, which they had agreed to clear them.