Tax Trouble

Jamshedpur, April 13: The regional office of the central excise intelligence (Jamshedpur) has issued showcause notices to Tata Motors along with three other companies for alleged tax evasion of central excise duty to the tune of Rs 17 crore in the last fiscal (2006-07).

Sources said Tata Motors has not paid central excise duty worth Rs 11 crore in the last fiscal. The three other companies — Sanik Mining Private Ltd, Hindustan Steel Company Ltd and Reply and Company — have evaded excise duty worth Rs 7 crore.

A Tata Motors official has confirmed that the director-general of central excise intelligence has issued a showcause notice to them.

“It is not a confirmed demand by the excise department related to the tax evasion of the central excise duty. The case is in hearing stage at the quasi-judicial authority,” the official said.

In addition, the regional office of the Union finance ministry has also issued separate showcause notices to 16 companies for evasion of service tax worth Rs 31 crore. Their names have not been disclosed yet.

The 16 companies, which are manufacturing different products in the Adityapur Industrial Area Development Authority (AIADA) belt and other parts of Jharkhand and Bihar, have been asked to explain service tax evasion before the quasi-judicial authority (assistant commissioner or joint commissioner).

Joint director of director-general of central excise intelligence (Jamshedpur), M.K. Dedia said a record number of showcause notices have been issued to various companies this year.

“These companies need to explain their stand before the quasi-judiciary, which settles cases lodged by the central excise intelligence. Our duty is to detect tax evasion by companies,” Dedia said.

A source in the director general of central excise intelligence office said on condition of anonymity that the tax department had been tipped off about the companies in the AIADA and other industrial belts with a record of tax evasion.

“We are collecting reliable information from various departments. We plan to raid other companies that have a history of tax evasion. Most of the companies have a tendency to evade taxes. But we raid companies and corporate houses that do not pay tax amounting to crores. The department works on tip-offs from private and government agencies,” he said.

The central excise department spread over the entire country administers and collects the central excise duty and service tax.