The Hindu Business Line : AP Commercial Taxes Dept looks at improving debt recovery system

WITHOUT wasting much time in waiting for a new Government to be formed in the State and spell out its strategy, the Commercial Taxes Department has decided to take up measures to improve internal processes and put in place an effective debt recovery mechanism at its headquarters.

Top officials of the department, who met here for two days last week, discussed various strategies that could help the department achieve a 15 per cent growth as expected by the Finance Department.

The department's revenue collections stood at Rs 9,187.54 crore (Rs 8,337.75 crore) for the financial year ended March 31, 2004, as against a target of Rs 9,741.27 crore.

"The department has set up a panel to review, rationalise and simplify provisions of works contract tax," Mr T. Vivek, Joint Commissioner, told Business Line.

Interestingly, the committee comprised representatives from the industry, tax consultants and lawyers. "We would like to incorporate their views on this issue so as to make it simpler. The industry is being represented by the likes of Nagarjuna Constructions and L&T," he said.

The panel is expected to submit its report by May 15. "The department will send it to the Government for its approval," he said. The panel would also like to take the perspective of the Accountant-General's office on this issue.

"Usually, it does post-mortem. We thought why not take its view and incorporate the same in the process itself," he said.

"The idea is to make it simpler, fairer and equitable and strike a balance between the taxpayer and the State," Mr Vivek said.

The meeting also wanted to give a thrust to debt management activity keeping an eye on an estimated Rs 100 crore - Rs 120 crore collectible amount.

"The scope for debt management would be broader for the year."

While the Central Revenue Recover Act allowed for taking the defaulters to the task, there was not much success on the recovery front. However, there were some success stories where individual officers pursued the matter to its logical conclusion.

"The meeting wanted this to be institutionalised with a full-fledged team at the headquarters looking into the issue," he informed.

The holistic debt management activity included liaison with courts and liquidators.

The department is also planning to strengthen its internal audit system.

The meeting, however, did not discuss additional resource mobilisation.

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