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Taxation

NMC categorizes 5-star hotel as residential property

Friday, 28 June 2013 12:32 administrator
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The Times of India              28.06.2013

NMC categorizes 5-star hotel as residential property

NAGPUR: Some call it callousness, while others call it favouritism. Nagpur Municipal Corporation (NMC) has categorized the five-star Hotel Radisson Blu located on Wardha Road as a residential property instead of as a commercial one and is charging it property tax calculated on that basis. This goof up has resulted in huge financial loss to NMC.

In reply to a query sought under RTI Act by Sanjay Agrawal, president of People Against Corruption (an NGO), NMC's Dhantoli zone office has admitted to have issued a demand note of Rs 1.33 lakh to the hotel, which is spread over area of 1.28 lakh sqft, as per its categorization as a residential property.

The tax receipts (a copy of which is in possession of TOI) clearly show that the hotel which is being run by Besteck Hospitality Pvt. Ltd. has been categorized as a property for residential use.

Agrawal has approached the municipal commissioner Shyam Wardhane demanding strict action against the erring officials in this regard.

Standing committee chairman Avinash Thakre admitted that residential property tax has been imposed on the five-star hotel instead of commercial one. "Already directives have been issued to NMC's tax assessor S Hastak in this regard," he said.

A senior NMC tax department official admitted that preliminary inquiry points towards a deliberate attempt by Dhantoli zone officials to impose residential property tax on the hotel. However, he quickly added that a fresh demand note will be issued to the hotel and according to the new assessment it will come to be around Rs 6 lakh per annum. He also pointed out that the hotel will have to pay the tax from the time it opened for business.

Earlier, the hotel came under the jurisdiction of Laxmi Nagar zone. However, after the 2012 civic elections the jurisdiction changed and it comes now under Dhantoli zone. It is suspected that tax inspector at Dhantoli zone must have assessed the demand notes issued by Laxmi Nagar zone before the hotel was built. So the amount on the demand note was less, said the officer.

Agrawal told TOI that the issue is very serious since NMC is reeling under severe financial crunch owing to the implementation of Local Body Tax. The corporation is running short of funds to pay its employees' salary. In most of the cases the tax being collected from commercial establishments has been found to be far below than that being recovered from residential properties.

Recently, Wardhane had made surprise visits to Dhantoli and Dharampeth zones and found out that many commercial buildings were paying less property tax as the assessors had calculated tax as per the residential rates for commercial users.

 

SMC turns to diamond units to achieve impact fee target

Thursday, 27 June 2013 11:58 administrator
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The Times of India              27.06.2013

SMC turns to diamond units to achieve impact fee target

SURAT: Having drawn a lukewarm response from residents to get their illegal structures regularized by paying impact fee, Surat Municipal Corporation (SMC) is now looking towards diamond units to achieve its target.

Top officials and elected leaders of the local civic body met diamond industry bigwigs at Dharmanandan Diamonds on Wednesday to sensitize the industry on impact fee regulation.

"We are targeting common buyers who in their ignorance bought some thing that is constructed illegally. Areas like Varaccha and Katargam are prime examples where majority of the illegal constructions came up under old development control regulation before 2004," an official said.

An official with town planning department Vijay Desai said, "Once obtaining building use certificate was made compulsory under new DCR after 2004 the illegal constructions declined."

Almost all the developers and builders who constructed illegal houses before 2004 are either out of the market or are not willing to take the responsibility. "Some of them claim in public that they would apply for regularization by paying impact fee, but when the time of paying comes, they go out of sight for few months to resurface later," an official said.

"We have adopted a direct approach to tap small offenders and are convincing them that getting their illegal construction legalized is in their favour. It is for this purpose that we are making visits to the industry and trying to tell the diamond workforce to get their constructions legalized," chairman of standing committee Rajesh Desai said.

Till now SMC has received 39,059 applications against the estimated more than 1 lakh illegal constructions in the city. Maximum of 17,623 applications have been received from Varaccha, while 4,985 are from Katargam zone of the city.

 

Notices issued to 2,300 traders for not paying Local Body Tax

Wednesday, 26 June 2013 12:25 administrator
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The Times of India             26.06.2013

Notices issued to 2,300 traders for not paying Local Body Tax

PUNE: The Pune Municipal Corporation (PMC) has issued show-cause notices to over 2,300 traders who have not paid the Local Body Tax (LBT), said VilasKanade, head of the civic LBT department.

Kanade was speaking at the general body meeting held on Tuesday. He said the administration would take action against these traders after they reply to the notices. "The traders have been asked to explain the details of their purchases and the reason why they have not paid LBT. Details of their octroi payments have also been sought," he said.

He said the details would reveal who was liable to pay the tax and who had failed to do so. The action against them would be taken accordingly.

The corporation has registered a threefold increase in the number of traders paying LBT, with more than 15,000 traders paying the tax for May, compared to 4,500 for April.

Traders had opposed the levy, which replaced octroi on April 1, and only a few had registered for it or even paid the tax in the first month of its implementation. It was only after the government met their demands that they called off their stir.

More than 68,000 traders have registered for LBT so far in the city. Those who don't import goods from other parts of the state or the city have been exempted from the levy.

The PMC has collected around Rs 181 crore as LBT from different sources in the last two months. Industries, liquor shops and oil companies are among those who have paid the tax, Kanade said. Payments have been made through demand drafts, cash, cheque and internet banking.

"The awareness about LBT has increased and more and more traders are coming forward to pay it. We expect more revenue in the coming months," Kanade said.

 
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