Accounts frozen: BBMP appeals to I-T tribunal

October 25, 2014 12:54 am | Updated May 23, 2016 06:29 pm IST - Bangalore:

The Bruhat Bangalore Mahanagara Palike (BBMP) has approached the Income Tax Appellate Tribunal regarding freezing of 40 of its bank accounts for non-payment of tax on Transferable Development Rights (TDR). The case will come up for hearing next week.

The I-T Department had raised a demand of Rs. 31.5 crore for Rs. 90 crore worth TDR issued by BBMP in the last two years as compensation for land acquired for development activities. The department froze the accounts when BBMP failed to pay up even after several reminders.

The BBMP has argued that issuing TDR is not a commercial transaction and it could not be taxed for the same.

BBMP Commissioner M. Lakshminarayan said that the civic body had no control over TDR once issued and the allottee could either sell it in the open market or use it. “A commercial transaction takes place only if the allottee sells the TDR. We are prepared to provide details of people who were issued TDR. Let the I-T people follow up with them,” he said.

The I-T department has allowed BBMP to carry out transactions through the 40 bank accounts it had earlier frozen.

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