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Tax tiffs take toll on treasury

New Delhi, March 4 (pti): The government’s estimated borrowings for the next fiscal at more than Rs 100,000 crore could have been reduced further had it been able to recover tax arrears of a similar amount entangled in legal cases.

In the budget 2007-08, finance minister P. Chidambaram has said the government will go for less borrowings next fiscal at Rs 1,09,579 crore against Rs 1,13,778 crore this fiscal.

However, this burden could have been eased if the government was able to expedite more than 27,000 cases in various courts across the country. “As on December 31, 2006, the number of cases pending with debt recovery tribunals is 27,250. The amount involved is Rs 100,461 crore,” minister of state for finance P.K. Bansal told the Lok Sabha recently.

Officials said in the absence of political will and limitations in the legal process, it is not easy to recover the tax arrears pending for the past many decades.

The government has to recover tax arrears of around Rs 30,000 crore from companies and persons involved in the security scam in early 1990s, officials said. There is little chance of recovery in most of these cases. But in many cases, corporates have preferred to contest cases in tribunals and courts even to save interests on taxes.

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