NEW DELHI: The Finance Ministry has issued tax demand notices of at least Rs 240 crore to some private companies and individuals who were involved in the conduct of 2010 Commonwealth Games-related projects here after the CVC detected huge tax evasion.
Besides, a recovery of about Rs 108 crore on account of service tax and workers welfare cess has been also made from them by the authorities, according to annual report of Central Vigilance Commission (CVC) for 2012, which was tabled in the Parliament recently.
“The Commission while scrutinizing the details of the various projects, provided by the organizations, observed non-conformance of statutory tax obligations also and decided to take up the issue with the authorities concerned.
“The initiative taken by the Commission in collaboration with the Labor Department resulted in recovery of an amount of Rs 41.8 crore towards workers welfare cess,” the report said.
The Central Board of Excise and Customs (CBEC), under the Finance Ministry, has informed that service tax has been recovered to the tune of Rs 67.33 crore so far, which includes Rs 52.21 crore on the basis of the Commission’s inputs, it said.
“It has also been informed that demand notices have been issued to the tune of Rs 240.77 crore. The reconciliation process with various departments or organizations regarding tax non-compliance issues concerning CWG 2010 is underway,” the report said.
PTI had late last year first reported that the CVC had detected huge tax evasion by certain private entities while executing works for the sporting extravaganza held here in October 3-14, 2010. . The Chief Technical Examination (CTE) wing of the Commission conducted intensive technical examination of some of the major projects or contracts relating to the Games to ensure adherence to the desired quality in execution and to unearth the shortcomings or lack of appropriate standards in the projects.
“A total of 30 projects or contracts, valued at RS 3,500 crore (approximately) were taken up for technical examination, from 2008 onwards,” the report said.
Further, a number of complaints questioning the quality of works executed and justifiability about the cost escalation were also received. Some of these complaints were directly inquired by the Commission and others were referred to CBI and Chief Vigilance Officers (CVOs) – who act as distant arm of CVC – concerned for investigation, keeping in view the seriousness of the allegations leveled in the complaints.
“A total of 19 regular cases and 10 preliminary inquiries were registered by CBI on CWG 2010, many of which were on the basis of references sent by the Commission. Similarly, a total of 26 cases were forwarded to the CVOs concerned for detailed investigation and fixing responsibility for the lapses,” said the report giving details of works done by the CVC between January and December last year.
For the direct inquiry, considering the number of agencies involved in organization of the games, the Commission used crowd sourcing method through a web-based application. “A total of 37 organizations uploaded the details covering more than 9,000 projects, costing about Rs 13,000 crore,” it said.
The Commonwealth Games were mired in alleged corruption in several projects executed by government and private organizations. Prime Minister Manmohan Singh had also announced a High Level Committee (HLC) to look into the allegations of corruption.
Six reports submitted by the HLC are being examined by a Group of Ministers (GoM). -PTI
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