Tax body to drag Vijay Mallya to court, cites 76 crore dues

NEW DELHI: Vijay Mallya, the king of good times and the promoter of Kingfisher Airlines (KA), is in for more trouble. The Central Board of Excise and Customs (CBEC) has taken a legal opinion to drag the owner of the ailing airline to court, and seek his prosecution for failure to clear Rs 76 crore as service tax dues.

The CBEC froze Kingfisher’s 40 bank accounts in February . The prosecution proceedings would begin once the March 31 deadl-ine expires. S K Goel, chairman of CBEC, said that though Kingfisher Airlines had deducted service tax from passengers, it did not deposit the sum, in a breach of norms.

The rule stipulates that if a person fails to deposit tax deducted at source for a period exceeding six months, the offender can be prosecuted and even face a jail term of up to three years.

Goel said that Jet Airways has cleared all its dues on service tax that stood at Rs 69 crore. Last December, the finance ministry had given an ailing Kingfisher the opportunity to clear its dues by depositing Rs 1 crore a day.

But when the airline defaulted , the CBEC froze its bank accounts.

In January, the CBEC had asked Kingfisher Airlines to settle its service tax arrears of Rs 60 crore till March 31.

Now, the dues have swelled to Rs 76 crore due to accumulated interest. The option to deposit Rs 1 crore daily was given after it had paid Rs 20 crore, settling the dues till last December, in two equal installments.

A similar action has also been initiated by the Income Tax authorities against airlines for not depositing TDS.