Haldia Petrochemicals Ltd (HPL) has opted to settle a long pending dispute over an entry tax with the Bengal government by taking advantage of a dispute settlement scheme.
The company has deposited Rs 81.16 crore, which is equal to two-thirds of the disputed tax amount, with the state exchequer and it plans to clear the rest of the dues by the end of this month.
HPL had submitted its application for the settlement of the disputed tax liability on August 29, days before it received a favourable final award from an arbitral tribunal, which entitled the company to receive Rs 3,285.47 crore from the Bengal government as an incentive.
The company opted for the settlement of its entry tax liability by way of the payment of 50 per cent of the tax amount with a waiver of interest, under the settlement of dispute (SOD) scheme of The West Bengal Sales Tax (Settlement of Dispute) Act 1999, as amended by the West Bengal Finance Act, 2023.
The final discharge certificate will be issued once the entire amount of Rs 121.75 crore is paid by November 30.
The settlement of dispute scheme was first introduced in 2018 by the Mamata Banerjee- government and modified in 2020 to make it attractive to taxpayers to save the rigmarole of litigation by settling a part of the total dues.
Bengal finance minister Chandrima Bhattacharya informed the members of the state Assembly in her budget speech on February 15 that 28,697 cases have been resolved even as 25,000 more cases are still pending before courts and tribunals.The 2020 SoD scheme was further extended to help the taxpayers.
Following the attempt at the dispute resolution with the government, HPL provided Rs 121.75 crore as an exceptional item in the statement of profit and loss in the quarter ended September 30. After the introduction of the contentious levy in 2012 by the state government, the entry tax faced several legal challenges.
HPL, like many other units based in the state, had challenged it as well. But the latest development suggests thatthe flagship company of The Chatterjee Group is looking to bury the hatchet with the state government, at least in this case.
Loss falls to Rs 179.9cr
HPL narrowed losses to Rs 179.9 crore in the second quarter of the fiscal compared with Rs 241.1 crore in the same period of the last fiscal.
Revenue from operations came off at Rs 3,067.4 crore compared with Rs 3,792.1 crore a year ago. For the first six months of FY24, it posted a loss of Rs 413.7 crore compared with Rs 402.5 crore in the first half of 2022-23.