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Air India told to pay service tax dues

Our Bureau New Delhi | Updated on March 12, 2018 Published on January 10, 2012

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The Central Board of Excise and Customs (CBEC) has warned the national carrier Air India to pay up a “reasonable” part of its service tax dues as early as possible or face having its accounts frozen.

Meanwhile, Kingfisher Airlines has paid up service tax due for the month of December by the due date. It even paid part of the arrears. It paid Rs 20 crore on January 6 which includes Rs 10 crore as due for December, and the remaining towards arrears due since April last year. The arrears now amount to over Rs 60 crore, which have to be paid by March 31.

Mr S.K. Goel, Chairman, CBEC, told Business Line, “We have sent a letter to Air India on Tuesday asking them to pay more. They have paid Rs 10 crore for the month of December but we think the amount could be more.”

He said that the total amount due for December could be between Rs 15-20 crore. But it is yet to be ascertained by the board as the airline is yet to file its service tax return.

Air India also has service tax arrears of Rs 300 crore. “We hope once the cash strapped national carrier gets equity support from the Government, this will be settled,” the official added. The airline is expecting Rs 6,600 crore as equity support by March 31, 2012. He also clarified that the other airlines such as Jet, Indigo, Spicejet and Go are regularly paying service tax.

Airlines collect service tax on every ticket they sell. So the money comes from the passenger and airlines are not supposed to keep it in their account, CBEC said.

Both Kingfisher and Air India had to face freezing of bank accounts last month because of unpaid dues. Both the airlines paid up for November and got relief.

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Published on January 10, 2012
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