Elite Clubs With Dues Seek Court Umbrella

Delhi’s leisure institutions such as Golf Course and Park Hotel, and nearly 100 other well-known institutions are seeking judicial umbrella.

Published: 03rd April 2016 07:50 AM  |   Last Updated: 03rd April 2016 07:50 AM   |  A+A-

NEW DELHI: Delhi’s leisure institutions such as Golf Course and Park Hotel, and nearly 100 other well-known institutions are seeking judicial umbrella to prevent paying up property tax worth more than Rs 1,000 crore to the New Delhi Municipal Council (NDMC) after the civic body launched a crackdown against some of the biggest property tax defaulters. In total, institutions such as the Flying Club, Bank of Baroda and Claridges Hotel owe Rs 1,500 crore to the civic body for the last 16 years.

Strangely, a church near Gole Market owes around Rs 2 crore to the council as it organises various commercial programmes. Sources said after the notice was served to it last month, the council managed to recover Rs 50 lakh. “Though we do not collect taxes from religious places, the church was carrying out commercial activities for several years,” the officer said.

As NDMC took harsher steps to collect money from defaulters, it generated the highest-ever revenue since it was constituted. It generated Rs 480 crore as property tax this year, which is 33 per cent more compared to the FY2014-15. Last year, the council collected Rs 360 crore.

Though the council avoided coercive steps in most cases, it sent a clear message to “powerful and influential business houses” in Lutyens’ Delhi that they will not allow any leverage and all the property tax defaulters have to pay each penny they owe to the council.

While some institutions agreed to comply with NDMC’s property tax assessment and pay up in installments, others have knocked the doors of the court.

An NDMC official said the biggest defaulters—Delhi Golf Club (Rs 726 crore) and Park Hotel (Rs 17 crore)—have knocked the court’s door. Sources also said Bank of Baroda, which owes around Rs 5 crore, plans to approach the court.

In January, the council sent notices to around 1,200 institutions to pay property tax. Of these, about 100 have disputed the council’s assessment and have gone to court to get relief. Others have intimated that they will file an appeal in the court against the council.

“Reserve Bank of India, which owes Rs 21 crore, has agreed to pay up. Flying Club owes Rs 10 crore has always agreed to in installments. Claridges Hotel owes around Rs 5 crore and has also complied to pay back in installments,” said an NDMC officer, adding that the council gets a major share of revenue from 340 properties in Lutyens’ Delhi.

NDMC chairman Naresh Kumar has given a clear direction to freeze the bank accounts of property tax defaulters after following all guidelines and following the Council Act.

NDMC’s perseverance is paying results with many institutions deciding to clear the dues, some dating back to over a decade.

Cracking the whip, NDMC first decided to freeze a bank account of Delhi Golf Club, withdrew the decision in a few hours. On March 23, a Ratnakar Bank Ltd account of the Club was frozen by the civic body for property tax dues of Rs 726 crore. Later, NDMC wrote to the bank the same day asking it to treat the earlier order as “withdrawn”.

Sources said NDMC took the decision in haste, flouting Section 99 (Presentation of Bill), Section 100 (Notice of Demand and Notice Fee) and Section 101 (Penalty in case of default of payment of taxes) of the New Delhi Municipal Council Act, 1994. Delhi Golf Club also warned the council that they will file a defamation case as the matter is pending the court.

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