Punjab local bodies minister Navjot Singh Sidhu today accused a private multi-system operator in the cable business of evading service tax to the tune of Rs 2,600 crore. He said that his department would impose taxes along with heavy penalty on the company, which thrived under the alleged patronage of the previous SAD-BJP regime. He alleged that the private cable operating company with “under declaring” the total number of cable operators and subscribers to evade due taxes. The fresh accusation against the company was made by the minister days after he accused the same private company of causing a loss of nearly Rs 700 crore to the state exchequer. “I have instructed my department to impose due taxes and penalty on the company. Instructions have also been issued to the concerned authorities to bring the working of the company under the law,” Sidhu told reporters during a press interaction. Sidhu has been seeking tough action against the company for causing heavy losses to the state-exchequer by allegedly monopolising the cable business in Punjab.
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The Congress had also promised to end the “cable mafia” during their campaign for the Punjab elections. “They (company) are the mastermind of corruption,” alleged Sidhu. “If we contain cable mafia alone, we can generate employment for one lakh people,” he added. Sidhu said the department would impose charges such as one time charges, annual fee, restoration and rehabilitation charges, bank guarantees on the company. Sidhu was accompanied by a former employee of the Central excise department, S L Goyal, who claimed that the central excise department had detected a service tax evasion of Rs 2,600 crore in 2012. Goyal said a raid was also conducted on the premises of the company that year. However, Goyal said that out of Rs 2,600 crore, the department sent a show cause notice for only Rs 179 crore to the company for alleged tax evasion.
“Thereafter, the rest of the amount became time barred as the financial liability exceeded five years,” he said, adding that if the tax evasion is calculated for the period, the amount would cross Rs 5,000 crore. Goyal said out of Rs 179 crore, only Rs 13 crore had been recovered by the department. He said out of 8,000 total cable operators, the company handled almost 6,500 local cable operators. “Out of 6,500 local cable operators, only 150 paid taxes,” he added. He also accused the central excise department of going slow in collecting taxes evaded by the company. Last month, Sidhu had written to the Central excise department and sought information regarding alleged irregularities by the company.