Non-payment of RS 500 crore in Taxes: BEST likely to meet govt officials, ask for relief

The BEST is facing losses of more than Rs 1,000 crore. In the budget estimates released for 2019-20 on Monday, the undertaking has showed an estimated deficit of Rs 844.71 crore for its transport wing.

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BEST plans to increase its fleet size from 3,337 to 4,050 buses by March 2020. (Express photo by Kevin DSouza)

After two bank accounts of the Brihanmumbai Electric Supply and Transport (BEST) were sealed by the Mumbai City Collector last week, the bus utility is expected to meet state government officials soon to discuss the issue. The utility is required to pay Rs 500 crore in taxes to the government, pending for the past eight years.

On October 26, the collector had sealed two bank accounts of BEST for non-payment of nutrition and passenger tax. While BEST pays passenger tax of 3 per cent on ticket fare revenue to the government on an yearly basis, passengers are charged a nutrition tax of 15 paise on their ticket fares. Senior officials said that both nutrition and passenger taxes amount up to Rs 60 crore every year. In a statement, the BEST said: “The Transport Commissioner/Transport Department has been trying to recover more than Rs 500 crore from BEST on account of passenger tax and nutrition surcharge. Due to non-payment by BEST due to its current financial condition, recovery was initiated by the Collector, Mumbai city.”

It added: “The collector has attached two accounts of BEST undertaking. We have requested the state government to give us immediate relief since we are facing severe financial crunch. We are hopeful of earliest resolution of the matter positively.”

A senior BEST official said: “A meeting will soon be held with the state government on the issue. BEST is going through financial stress and thus repayment of the entire tax altogether will be difficult. We will ask the government to grant us relief on the payment of taxes or allow us to not pay it altogether. They have requested us to pay the tax from November.” The collector had served a notice of non-payment of taxes to the BEST in August. BEST officials said the management was in discussions with the transport department over the issue for the past two months.

On Wednesday, BEST Chairman Ashish Chemburkar met state Transport Minister Diwakar Raote to ask for a stay on the sealing of bank accounts.

“As soon as I came to know about the matter, I rushed to the Mantralaya on Wednesday to ask the minister to intervene. While there is a temporary stay on sealing of our bank accounts, we plead to the state government to consider BEST’s financial situation and grant us laxity. Similar to the way the state government relaxes norms for transport utilities in other cities, including Pune and Ahmednagar, they must look at BEST as well,” Chemburkar told The Indian Express.

The BEST is facing losses of more than Rs 1,000 crore. In the budget estimates released for 2019-20 on Monday, the undertaking has showed an estimated deficit of Rs 844.71 crore for its transport wing. It plans to increase its fleet size from 3,337 to 4,050 buses by March 2020.

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