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VRISHTI BENIWAL New Delhi, 20 January After a massive campaign to collect dues of service tax defaulters through an amnesty scheme, the Union finance ministry has now turned the heat on by using the arrest powers given to its officers in the previous Budget. Since January 1, the service tax administration has arrested eight defaulters for not paying dues totalling ₹ 36 crore. In three such cases, the tip came evaders themselves —they made disclosures under the Voluntary Compliance Encouragement Scheme ( VCES) but did not deposit the dues till December 31, the last day of the scheme. With these, the total of arrests by the tax authorities of company executives has risen to 28 in six months. The drive will continue. Revenue Secretary Sumit Bose had warned of stern action from January 1against service tax evaders. Under VCES, announced in Budget 2013- 14, service tax defaulters had to pay half their dues by December 31 and rest by June 2014, to avoid interest, penalty and prosecution. A defaulter could avail of this after filing a truthful declaration of dues since October 2007 and making the payment in one or two instalments. "In a few cases, the taxpayers had filed adeclaration under VCES, but they did not pay up the amount. In some of those cases, we have taken action. In a majority of the cases, the tax was taken from the recipient but not deposited with the government," said a finance ministry official, who did not wish to be identified. The eight arrests in January were in Delhi, Mumbai, Surat, Ahmedabad and Bangalore, in the construction, building, fitness and health, site preparation, mining and security sectors. Those arrested included the executive director of a luxury hotel, managing director of a consultancy service, executive of a fitness company, director of a security company and chief financial officer of an aviation company which provides helicopter chartering services. If the charges are proved, the defaulters face imprisonment up to seven years. Evasion of service tax of ₹ 50 lakh and above is a cognisable offence after passage of the Finance Act last year. Officials said the data was still being compiled from field formations and there could be more instances where defaulters did not clear their dues despite applying for VCES. An officer said Finance Minister PChidambaram had taken personal interest in popularising the scheme and the department would be tough on those who did not take the chance. The service tax amnesty scheme has added around ₹ 7,700 crore to the government coffers. Till December 29, the government had received a little over 40,000 declarations, involving about ₹ 5,500 crore. This would broadly correspond to ₹ 55,000 crore of services which escaped the tax net. As some more defaulters applied in the final two days of the scheme, the government is learnt to have received about ₹ 7,700 crore. The payments will help the finance ministry tide over the financial crunch in the wake of a lower than budgeted revenue intake. At present, of the 1.7 million registered assessees under service tax, only 700,000 file returns. Some are exempted, with a turnover of less than ₹ 10 lakh annually. Eight, including directors, charged after amnesty scheme expired on December 31; drive to continue |
| Govt launches portal to better biz climate |
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New Delhi, 20 January Notwithstanding inter- ministerial differences, the government on Monday flagged off the second phase of its ambitious e- biz project, an integrated eBiz portal which would make doing business in India a lot easier. The portal allows potential entrepreneurs to do most of the formalities online— submitting forms, making payments, among others. They can also track the status of their requests through the portal. However, the ministries crucial for clearance of projects like the ministry of environment & forests ( MoEF) are yet to become part of the project, raising questions on how the hassles in doing businesses would be addressed. Launching the project, commerce and industry minister Anand Sharma said his ministry would soon approach the Cabinet Committee on Infrastructure ( CCI) to bring resisting ministries such as the Ministry of Environment & Forests ( MoEF), on board. The project, which was supposed to have been launched in August 2013, is facing stiff opposition from the Central Board of Excise and Customs and the Central Board of Direct Taxes, apart from MoEF. Environment is one of the key ministries giving clearances to various projects. " MoEF is important because we see delays that lead to weakening of our growth and also the cost of projects keeps on rising and exposure of financial institutions to various projects is also enormous." The eBiz project, first announced in 2009, looks to improve the country's ease of doing business quotient. According to a recent World Bank ranking, India stood at 134th among 189 countries in terms of ease of doing business. "It has been a matter of concern that we were ranked very low," said Sharma. A commerce ministry statement said the eBiz platform enables a transformational shift in the government's service delivery approach from being department- centric to customercentric. The first phase of the project, which provided information on forms and procedures, was launched on January 28, 2013. The second phase, launched on Monday, has added two services from the Department of Industrial policy and Promotion – industrial licences and industrial entrepreneur's memorandum – along with operationalising the payment gateway by the Central Bank of India. The government has inked a 10- year contract with Infosys Ltd, where a total of 50 services (26 central + 24 state) are being implemented across five states – Andhra Pradesh, Delhi, Haryana, Maharashtra and Tamil Nadu – in the pilot phase. Five more states – Odisha, Punjab, Rajasthan, Uttar Pradesh and West Bengal – are expected to be added over the second and third years. According to Raghupathi CN, head of India business at Infosys, the project is slightly delayed due to several departments' resistance to change. "The project is slowly nibbling away at the resistance; some stability in the political environment is also expected to improve the situation." Raghupathi said the departments are used to running their services in the offline and manual way for several decades now. He said the implementation is "slower than expected" because it is tough to expect departments to completely change their modus operandi overnight. " While there are some easy adopters, there are others who clearly do not see the benefit of it." The portal will not only create asingle- window for all registrations and permits, but will also provide investors with a checklist. So far, there was never a checklist, and people were forced to go from department to department filling forms, never knowing what was remaining, said Raghupathi. "Only 50- 60 per cent of the services were digital, everything else was manual," he added. The government hopes to bring online over 200 services related to investors and businesses over the next 10 years on the portal. Sharma says efforts on to bring dissenting ministries on board eBiz platform Commerce and Industry Minister Anand Sharma launched the eBiz project BS PHOTO |
| Rail Tariff Authority gets nod |
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New Delhi, 20 January The Cabinet on Monday approved the setting up of a Rail Tariff Authority to advise the railways on passenger and freight rates. In August 2013, the Cabinet had given an in- principle nod to set up the authority and sent a draft note to the railways, to be discussed with the law ministry. After talks in this regard, the railways had sent the proposal back to the cabinet for changes and clarifications. The authority will be a fivemember body. The selection committee will comprise the Cabinet secretary, chairman of the Railway Board, the finance secretary and an expert on railways. Such an authority, whose orders on passenger and freight rates will be binding on the government, can only be set up after seeking an amendment in the Railways Act, 1989. The authority, mooted by member of parliament from the Trinamool Congress ( TMC) and former railway minister Dinesh Trivedi in Railways Budget 2012- 13, was pursued by his successors C P Joshi, Pawan Kumar Bansal and incumbent Mallikarjun Kharge. The Cabinet also approved the setting up of an electric locomotive factory at Madhepura, Bihar, at an estimated cost of ₹ 1,294 crore. A proposal to set up a diesel locomotive factory in Marhaura, Bihar, at a cost of ₹ 2,053 crore was also cleared. The two factories will be set up as joint ventures and the locomotive manufacturers will be selected through international competitive bidding. The bids will be finalised within six months. Through 10 years, the factories will provide the Indian Railways 800 electric locomotives and a mix of 1,000 diesel locomotives. NCABINET DECIDES N corridor receives green signal | Federal Bank gets CCEA nod to raise foreign shareholding to74% |Jains to get minority status |JV to develop trunk infrastructure at Greater Noida in the Dadri- NoidaGhaziabad Investment Region of DMIC |Development of trunk infrastructure at Vikram Udyogpuri in the Pithampur investment region of DMIC |SPV for Model Solar Power Project at Neemrana, Rajasthan as a 100 per cent subsidiary of the DMICDC |₹ 2,727.10- cr financial support to Nalanda University over a period of 12 years from 2010- 11 to 2021- 22 OTHER DECISIONS |
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