Previous state government vide Amendment Act, 2009 has introduced penal interest of 24% on Property Tax vide its Section 70 which seeks to amend the Section 154 of the City of Nagpur Corporation (CNC) Act, 1950. It mandates that, a bill of demand/dues in respect of Property Tax which was issued under the CNC Act but has remained unpaid would call for such a penalty on and from the date of commencement of the Amendment Act, 2009.
Accordingly a delegation of Vidarbha Taxpayers Association (VTA) led by its president J. P. Sharma submitted memorandum to Chief Minister Devendra Fadnavis requesting reduction in interest rate being charged.
Sharma said this interest charged is too high and under the procedure if someone pays entire tax amount in advance, the rebate offered by Corporation is only 2% per annum and that too only on general tax part, which translates approximately to only 1% and on other hand charges 24% for delay, these rules needs to be amended as common man being harshly punished in case of delay of payment of property tax. Moreover property tax is charged to practically every owner, irrespective of his financial status, size of house ownership, etc, thus many economically weak are getting severely punished by this high interest rate.
Tejinder Singh Renu, secretary of VTA said other Revenue Departments like Income Tax charge 12% u/s 234, Sales Tax 18%, Service Tax 18%, Service Tax for small service provider 13%, Excise 18% and TDS 18%. This clearly demonstrates that even revenue departments don’t charge interest more than 18% and property tax is charged by service department i.e. Municipal Corporations and as such they shouldn’t charge mammoth interest rate of 24% under any circumstances.
Renu said imposing a penalty of 24% per annum interest on delayed payment of Property Tax is nothing but a glaring example of Unjust Enrichment. Municipal Corporations are not meant for revenue generation; its basic duty is to provide civic facilities to the citizens, hence maximum rate of interest on delay payment on House tax should be 12% per annum, so that common man can bear it without getting hurt by its exorbitant amount.
VTA requested Chief Minister Devendra Fadnavis to amend this provision so that common man is benefited or at least bring slab system to balance all categories on annual tax amount basis.
Also present prominently in VTA delegation were Vice President Ramkishan Ojha, Joint Secretary Hemant Trivedi, Executive Body Members Amarjeet Singh Chawla, Rajesh Kanoongo, Saqib Parekh, Ashwin Agrawal & others.