Fastway evaded Rs 684-cr tax: Sidhu

By 24th June 2017 0 Comments


Cable mafia issue resounds in Vidhan Sabha
Alleges irregularities, loss to state exchequer; hints at action by Local Bodies Department
Sidhu targets private cable company allegedly enjoying political patronage
Chandigarh, June 23, 2017: Punjab Local Bodies minister Navjot Singh Sidhu has hinted that his department might soon initiate action against irregularities committed by cable mafia in the state.
He alleged a private cable network violated law under patronage of a political family; forced small cable operators out of business and evaded crores of rupees as tax. He said that it was also revealed that the number of cable connections was fudged, unauthorized optic-fibre cable laid, various tax evasions, non-payment of charges for electricity poles and forged cable operator accounts were made in what could be a multi-crore scam.
Replying in the Vidhan Sabha to a question raised by MLA Sukhjinder Singh Randhawa about cable business, Sidhu said that investigation also revealed an unholy nexus that cost over Rs 500 crore loss to the state exchequer during the past decade.
Had this amount been deposited in the government treasury, a big city could have been developed, he added.
Sidhu said the cable business took wings with formation of Akali government in Punjab and finished small cable business with an intent to monoplise the business. As of now, the business is being run by a single cable company in the entire state.
He wondered that the records showed 1.25 lakh cable connections which was contrary to the fact that Punjab has 80 lakh televisions.
The state has over 8000 cable operators out of which 6500 operate directly and about 1500 indirectly operate under a private cable company. Interestingly, only 1500 cable operators are accounted for in the record of the central government service tax department. It is learnt that the central department has issued notices for payment of Rs 250 crore as service tax. Out of these, Rs 23 crore have been deposited.
Entertainment Tax Evasion:
Punjab implemented entertainment tax from November 13, 2011 under which every local cable operator and multi-system operator was required to pay Rs 15,000 tax per annum. Out of existing 8000 operators and 18 multi-system operators only 150 pay this tax that too occasionally. Interestingly, not a single operator pays this tax in the Badals native Sri Muktsar Sahib district. This was revealed in the information got under RTI. This way Punjab government was deprived of Rs 184 crore including interest and fine, said Sidhu.
Sales Tax Evasion:
Sidhu also said that this private cable company and its 12 other companies import setup boxes from abroad. They get tax incentive on their import. These boxes are given to cable subscribers at the rate of Rs 30 to Rs 40 per month. Besides Rs 800 to Rs 2500 are charged as security on these. This security amount is supposed to be reimbursed to the subscriber on return of the setup box but this amount is deducted every month and nothing is left due for payment to the subscriber after 3 years. The refund policy of the company is mentioned on its website. The sale of setup box attracts sales tax which is never paid. During last 5 years, roughly over Rs 100 crore tax has been evaded this way. The amount comes to Rs 220 crore by including interest and fine.

Roads Cutting and Laying underground cables:
This company in collaboration with Reliance company has laid underground optical fibre cables in the entire state. Cutting rod for the purpose attracts charge of Rs 500 per metre and Rs 1000 for a manhole. Reliance company was allowed to lay cables on the condition that they would lay these cable free of cost. The lands belonging to the Municipal Corporations, National Highwaya, Canals Department, Forests Department and Railways were used for the purpose but neither any permission was sought nor any charges paid to these government departments for 1100 kilometres long cables laid.
Sidhu pitched for registration of a police case for unauthorized laying of cables as this posed danger to the national security. A recovery of Rs 180 core is pending including Rs 83 crore on this account which is a direct monetary loss to the government.
Speaking about unauthorized use of electricity poles, he said cables were put up on the poles in the state and for this Rs 100 is to be paid for each pole. As of now, about 3.25 lakh poles are being used but no charge is being paid to the government. The state power corporation has suffered a loss of Rs 30 crore if 300 percent fine and interest is added the amount comes to about Rs 100 crore.
The total liability of the company to the government is about Rs 684 crore, Sidhu said.
He opined that if this business was taken over by the government, about a lakh youths could have been provided employment.
While Sidhu was speaking, some Congress MLAs stood up to ask when action would be initiated in this case. Sidhu told that framing new law in this regard was prerogative of the CMO but he would initiate action within purview of his department.
Sidhu also targeted a Punjab TV Channel along with the cable company.
He repeated the allegations while interacting with the newspersons at the press lounge on Vidhan Sabha premises.
Congress MLAs Sukhjinder Randhawa, Kushaldeep Dhillon, Kuljit Nagra, Sukh Sarkaria, Harminder Sandhu, Inderbir Bolaria and Fatehjung Bajwa were also present.

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Posted in: Punjab