I-T raids: BMTC ops won’t be hit
The operations of the Bangalore Metropolitan Transport Corporation (BMTC) will not be affected even though their bank accounts are to be frozen by the Income Tax Department owing to failure to pay tax.
Sources in the BMTC said that it may not impact BMTC operations as they generate revenue of about Rs. 4 crore daily from their operations and some amount of the profits is reserved as savings. “We daily generate revenue of approximately Rs. 4 crore and a portion of our profits is reserved as crisis management fund or savings fund. We can utilize this fund to run buses till things come to normal,” said a source in the BMTC.
As per reports, bank accounts of the KSRTC and the BMTC have been frozen as they failed to pay Rs. 23 crore and Rs. 39.77 crore income tax respectively for the assessment year 2009-10. Freezing of bank accounts triggered speculations of BMTC halting its services.
“Until 2008, we were eligible for tax exemption as we were given the status of ‘charitable institutions'. But the IT Department, on the grounds that the BMTC is engaged in commercial activities, removed us from this category. Now tax is being enforced on us as we are making profits. We had written to the bank yesterday requesting them not to freeze our account. We hope that things will settle down. But as of now, the operations of BMTC will not be impacted. But if we fail to pay money to the Indian Oil Corporation Limited (IOCL), which supplies fuel for running buses to the BMTC, a crisis may occur and we may have to withdraw our services,” said BMTC Chief Accounts officer, B. Chinnaswamy.
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