Bank account of AP liquor firm frozen

May 05, 2012 |

Hyderabad

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The state government was in for a nasty surprise when the Income-Tax department froze the bank accounts of the AP Beverages Corporation Limited, the wholesale liquor dealer in the state, when it did not pay tax of Rs 869 crore for the financial year 2009-10.

The I-T department and APBCL have been at loggerheads over this issue for the past few years.

While the I-T treats the corporation as any other commercial entity and levies tax on the revenue earned through sale of liquor, the government took the stand that the corporation is only an intermediary and the entire proceeds are state revenue which does not get any income tax levied on it.

The APBCL obtained a stay from the High Court on assessments for previous years. “The court also gave clear instructions not to take any coercive action,” corporation MD M. Jagadeeswar said.

The corporation has filed a case regarding the 2009-2010 assessment which is yet to come up for hearing. “We’re moving the vacation bench for the release of the bank accounts,” he said.

The APBCL will be in trouble if the accounts remained frozen as it has to pay distillers for stocks.

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