HYC demands action against petrol pumps which defaulted in VAT payment

Syllad | The Rising MeghalayaJune 22, 2021

The Hynniewtrep Youth Council (HYC) on Tuesday demanded the NPP-led MDA government to reconsider its decision to offer one-time settlement (OTS) scheme to petrol pump dealers who defaulted in clearing the huge outstanding value-added tax (VAT).

In a memorandum addressed to the Chief Minister Conrad K Sangma, Deputy Chief Minister Prestone Tynsong and Taxation Minister James K Sangma, the HYC has also suggested the need to take action against the defaulters as per law.

“We urge upon your good office to reconsider the OTS scheme to petrol pump dealers and direct the department concerned…to take necessary steps to realise all outstanding taxes and to take appropriate actions as per the relevant provisions of the law in case of wilful defaulters or delay in making payments,” general secretary of the organization Roy Kupar Synrem said in the letter.

This came after the state’s taxation department has decided to implement the OTS scheme for recovery of huge outstanding VAT from over 230 petrol pumps across the state.

Synrem said it was also reported that the concerned department has failed to realise an outstanding amount of Rs 650 crores (approximately) from these petrol pumps in the last 3 years as VAT.

“if this practice of OTS is to be extended to the petrol pumps in the state, in payment of VAT by waiving off 30% of the taxable amount, it will be a loss of approximately Rs 195 Crores to the State’s revenue collection for the last 3 years,” he added.

On the other hand, the HYC leader also questioned the taxation department for coming up with the OTS when VAT is realised under the Meghalaya VAT Act  which makes the dealers mandatory to pay the taxes as computed under the relevant provisions of the Act for the specific period.

In fact, the Act provides for payment of simple Interest of 2% per Month by dealers in case he does not make payment in the due date as per the provisions of the Act as well as it provides for Offences and Penalty for non payment or delayed payments of Taxes under the Act.  

He further wondered if it is not illegal for the department to come up with this questionable scheme when the law is clear that a defaulter should be penalised as per relevant provisions.

“Is it not incumbent upon the department concerned to pursue the matter of these tax defaulters in the appropriate forum or the competent Court of Law and realised the outstanding Taxes as well as interests payable, if any, instead of providing them opportunity to pay less than they ought to?” Synrem asked.