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Survey finds Rs 63 crore property tax irregularities

Eight major establishments gave false information under self-assessment of property tax scheme; councillors blame BBMP joint commissioner for letting defaulters get away

Published: 01st November 2019 06:40 AM  |   Last Updated: 01st November 2019 06:40 AM   |  A+A-

Congress councillors protest for cut in budget allocations on Thursday. The outlays were made suring the Congress-JDS alliance | Shriram B N

By Express News Service

BENGALURU: A recent report of the Bruhat Bengaluru Mahanagara Palike (BBMP) on the total station survey has revealed that upscale establishments in heart of the city, including prime star hotels, have given false information under the self-assessment of property tax scheme.Also, the Palike joint commissioner has helped defaulters get away with penalties which has cost the exchequer a loss of around Rs 63 crore. The matter was raised in the BBMP council on Thursday, which was the maiden meeting chaired by the new Mayor N Goutham Kumar. The council meeting was held after a two months gap.

Senior BJP councillor Padmanabha Reddy said that under the self-assessment scheme, eight large buildings in the city including star hotels like Lalit Ashok, Chancery Pavillion, The Oberoi, East West and Atria, had shown lesser property size to pay less tax. The list also included Sushan Tech Ltd, a software firm in Domlur. The total station survey (TSS) report (done from 2017), shows that these properties should pay a total of about Rs 83 crore as property tax. But the newly appointed Joint Commissioner (East) Ravindra had reduced the tax to Rs 22 crore, due to which the Palike suffered a loss of over Rs 60 crore.

Reddy explained that as per procedure, the revenue inspector inspects the site and submits the file to the assistant revenue officer (ARO) which is then submitted to the revenue officer and then to the joint commissioner (JC). In the case of these properties, the ARO had demanded that penalty be paid, but the joint commissioner showed leniency.

He explained that as per rules from April 1, 2008, tax, along with 2% monthly interest should be collected as penalty. But the joint commissioner sought penalty for only three years. Also, when the DC-Revenue got to know of this, he issued orders to take action against Ravindra, but the Commissioner did not act upon it.

Senior Congress councillor K Gunashekhar added that the dues to BBMP may run up to Rs 500 crore as properties also include hospitals, hotels, large commercial establishments, malls and others. A white paper should be presented on the survey conducted. As per the Karnataka Municipal Act, the joint commissioner has no right to hold a legal hearing and only courts can do so, he noted. He also questioned if permission was sought from the Commissioner to hold the hearing.

Ravindra defended himself in the council and rubbished the allegations against him. He said the hotels were assessed on five parametres including star rating, depreciation of the building and taxable area. So Lalit Ashok hotel was asked to pay Rs 9 crore as, according to their legal team, it is not a star hotel and the building has seen 39% depreciation over the years.

Agitated by the responses, councillors, cutting across party lines, shot back at Ravindra and the Commissioner and said, if that was the case, then BBMP and citizens should file a legal case against the hotel as they charge exorbitantly for the services in the name of being a star hotel. The Mayor also joined in saying that in the name of being a five-star hotel, they were showing people stars.   
BBMP Commissioner B H Anil Kumar told the council that he was made aware of the anomalies regarding eight properties. “I have asked Special Commissioner (finance) Lokesh to give me a report, based on which action will be taken immediately. I have also directed the revenue officials to dispose of all total station survey cases in one month. We will submit the report at the next council meeting,” he said.

Legal cell staff to be cut down
BBMP commissioner B H Anil Kumar said he is in discussions with the mayor on reducing the large strength of the legal cell. “I was surprised to learn that it’s a team of 150 people. There is no need for more than 20 people. The list is being examined and all those who do not perform and are not needed will be removed,” he said. The mayor said the final list will be drawn soon.

Medical Grants
On shortage of Rs10 crore for medical grants, the mayor and commissioner said they were looking into funds in their kitty to make ends meet. They also admitted that 1,405 files on this were pending with BBMP.

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