CHENNAI: A section of property owners from George Town recently submitted a memorandum to Chennai Corporation officials that the property tax demand notices served on them in recent months were unreasonable.

The civic agency had sent notices for a section of residents who were found to be evading property tax over the years. But the owners have claimed that the civic agency's revenue officials had guided them in calculating the tax and that they were not to be faulted.

Over the past year, the Corporation has been checking for anomalies in the bigger properties in the city with half-yearly property tax above Rs.10,000.

Senior officials conducted spot inspection of the properties and cross-verified it against measurements declared in their records for property tax calculation. The Corporation reviewed the tax for under-assessed properties and have also demanded arrears. The Chennai City Municipal Corporation Act says they can demand arrears for the past 12 half-yearly instalments.

Though the civic agency is normally expected to carry out such checks, the difference in the past year has been the intensity of the exercise. The civic agency still has outstanding property tax arrears of over Rs. 150 crores and wants to tecover it, especially since property tax revision was not carried out in 2003. Officials have been hard pressed to increase the revenue to keep up with increasing capital expenditure.

There has been improvement in Corporation's tax collections from Rs. 163 crores in 2003 to Rs. 220 crores in 2004-05. Officials say that the review of bigger properties has contributed handsomely to the tax collections. Subsequently, they have also increased the spending on capital works.

However, some councillors and those who have received the tax demand notices are viewing the civic agency's drive as an exercise in contradiction.

G.V. Sundaran, a George Town resident who received the tax demand notice, wonders how the Corporation had suddenly woken up to under-assessed properties when for the last six years its own revenue staff had been consistently interacting with property owners. Mr. Sundaran jointly owns three commercial buildings in George Town.

Syed Masood, independent councillor and founder of Mass Line, the organisation that submitted the memorandum to the Commissioner, says Corporation revenue officials were as much at fault for the underassessment as the owners and that it was not fair to punish just the residents. "It is one thing to demand higher tax from the under-assessed property owner from the next year on and entirely different thing to demand arrears for the last six years."

Mr. Masood further said: "The businesses have moved out of the region ever since Flower Bazaar and the state bus terminus moved over to Koyambedu. The floating population has also decreased since the inauguration of the Madurai High Court and transfer of several cases from the Madras High Court. The review in property tax will hurt a lot more now," he explained.

"Officials won't be spared"

Chennai Corporation Commissioner M.P. Vijayakumar said officials who had colluded with the residents for underassessment would not be spared. He said the civic agency was just carrying its routine duty in bringing to book the taxes rightfully due.

"If the officials have colluded, action will be taken against them also. Precisely for this reason, verification is taking place. Due to unscrupulous collusion between some officials and assesses, the Corporation should not suffer," he added.

Officials pointed out that checks were being carried out only on bigger properties and was not targeting the average taxpayer. In some cases, even properties with half-yearly tax above Rs. 40,000 were declared at just above Rs. 10,000.

To demystify and simplify the taxation process, the civic agency last year brought out books detailing the basic rates of properties in its ten zones and the formula for calculating property tax. They are available at all Corporation zonal officials. The basic rates of properties can also be viewed on the Corporation website www.chennaicorporation.com.

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