Manyata Tech Park told to pay Palike Rs 83.45 cr tax arrears

Classification of taxation is rational, justified: HC judge

Manyata Tech Park told to pay  Palike Rs 83.45 cr tax arrears
The Bruhat Bengaluru Mahanagara Palike has received a shot in the arm following the Karnataka High Court order on a petition by Manyata Tech Park, justifying the categorisation of buildings based on installations like centrally air-conditioned industrial and technology parks.

The court rejected the petition by the tech park and asked it to pay the difference amount of Rs 83.45 crore to the Palike. The tech park had been paying at the rate of Rs eight per square foot whereas it was supposed to pay at Rs 10 per square foot.

The BBMP had sent a demand note asking it to pay the difference amount of Rs two since its inception. Contending the fixation of tax at Rs 10 per sqft, the tech park promoters had gone to the court.

On Wednesday, the bench of Justice L Narayana Swamy noted that the classification of taxation system based on the facilities was justified and rational.

It also complies with the Constitutional provisions, the court had observed. The BBMP's Taxation and Finance Committee chairman M Shivaraju said the firm will have to pay Rs 110 crore, which includes the interest on the difference amount.

“The tech park had been paying the tax at Rs eight per sqft. We had demanded them to pay at Rs 10 per sqft, which it had rejected,” Shivaraju said.

A big victory
He said the High Court order is a big victory for the BBMP as owners of buildings with centrally air-conditioned, who have gone to the court challenging the taxation system, will fall in line.

“We had recently released the list of top ten defaulters and almost all of them have gone to the court challenging our taxation method,” said Shivaraju.

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