Taxing the Valley

WHILE many term it as a new reign of administrative terror, the Income Tax Department has scripted a success story in the Valley, not only exceeding its targets but also almost tripling collections over a three-year period.

WHILE many term it as a new reign of administrative terror, the Income Tax Department has scripted a success story in the Valley, not only exceeding its targets but also almost tripling collections over a three-year period. This even as the electricity, water and sales tax departments struggle to meet their revenue collection targets in the region.

Three years after all the records in its Srinagar office were gutted in a fire caused by militants8217; crossfire, the headquarters of the Income Tax Department has risen, literally, from the ashes.

Collections have risen from Rs 182 crore in 2004-2005 to a whopping Rs 534 crore in 2007-08. The tax base of Jammu and Kashmir widened from 92,242 returns being filed in 2004-05 to 1,15,766 returns being filed in 2007-08.

The IT Department now works out of a rented bungalow in Srinagar8217;s Rambagh area. With IT notices being sent at a frenzied pace, the office is swamped with harried businessmen and traders late into the night. Recently, a single lot of 500 IT notices was sent to residents of Srinagar alone, which explains why the department8217;s Rambagh office resembles a place under siege.

J038;K Income Tax Commissioner Virinder Singh is responsible for all the renewed action. The increased collections are the result of a sustained awareness drive and intense intelligence collection on defaulters in the state, he said.

8220;In J038;K, what we encounter is a complete lack of awareness on Income Tax matters among people at a lower level and massive Income Tax evasion at the higher level,8221; he said. 8220;We have come down with a heavy hand on both counts.8221;

It took almost a year for the IT Department to replicate its destroyed records, following which a voluminous master list of defaulters was prepared for the state, based on the 100-odd parameters listed by the Central Board of Direct Taxes for the entire country.

Story continues below this ad

Along with this was the resolve not to leave the 8220;big fish8221; out of the recovery drive. On January 9, Singh himself led a raid on the properties of Altaf Bukhari, treasurer of the People8217;s Democratic Party, and his father Iqbal Bukhari. Thus, the Valley witnessed the high drama of a major Income Tax raid after decades. Sources said that despite political pressure, the department made out a demand of over Rs 50 crore for tax violations by FIL Industries 8212; the company owned by the Bukharis.

The department has also been zealously following up what is described as cases related to the 8220;Hurriat group8221;, many of which date back to the 1996-2002 period and are pending in appeals. It has clubbed 19 people in the 8220;Hurriat8221; list and computed a demand of Rs 7.9 crore. Among the top defaulters in the list are Syed Ali Shah Geelani with an outstanding demand of Rs 3.2 crore; Maqbool Lone with an outstanding of Rs 9.7 lakh and Shafi Malik with Rs 8.2 lakh due to the department.