BHUBANESWAR: The Earnings Tax division has flagged non-payment of tax by State businesses, which had partnered with non-public hospitals to run Covid hospitals throughout 2020-21 fiscal. The State authorities had roped in 30 non-public hospitals to arrange devoted Covid hospitals within the districts through the first wave of the pandemic final 12 months and paid almost Rs 344.55 crore. As per provisions of Earnings Tax Act, 1961 and Earnings Tax Guidelines, 1962, the relevant charge of TDS ought to have been deducted by the officer or drawing and disbursement officer on the time of constructing the cost.
IT division sources mentioned the funds have been made with out deduction of tax at supply. “The businesses owe round `50 crore in the direction of TDS within the final monetary 12 months. They need to have deducted the TDS on the time of constructing cost and deposit within the Central authorities account inside the prescribed due date,” sources knowledgeable.
The funding businesses of the State authorities had made numerous funds like fastened rental fees and for variables like consumables, medication, PPE, sufferers’ food regimen and ambulance/mortuary providers to those hospitals.
Curiosity at 1.5 per cent per thirty days is liable for late deposit of TDS from the date of deduction until the date of deposit of such tax and curiosity at one laptop is liable for non-deduction of tax at supply. “In case, any hospital is exempted from tax, the businesses may have produced no-deduction certificates. However right here, neither the no-deduction certificates has been utilized nor produced by the funding businesses,” mentioned an IT official.
Citing non-payment of tax, Commissioner of Earnings Tax (TDS) SM Keshkamat has written to Chief Secretary Suresh Chandra Mohapatra requesting him to challenge essential directions to the officers involved for deduction and cost of TDS on the earliest. As per norms, deduction needs to be made at 1.5 per cent of the quantity paid for any work as per the agrement with the non-public hospitals and at 7.5 per cent for hire paid to be used of land or constructing.
Keshkamat has warned that non-deduction of tax could appeal to penalty. “If TDS for any cause has not been paid to date, the identical needs to be made through the present monetary 12 months and remitted to the Central authorities account together with the relevant curiosity,” he acknowledged.