 "Maharashtra co-op sugar mills seek I-T relief")
The Federation of Cooperative Sugar Factories in Maharashtra, a representative body of about 200 units, met the income tax chief commissioner yesterday, urging the recovery of arrears be deferred. It also requested the income tax department to refrain from attaching assets and sealing bank accounts.
A total of 68 cooperative mills would have to pay 10 per cent of the Rs 1,000 crore, which includes interest and penalty since 1992-93, to pay 10 per cent to the income tax department.
Cooperative factories said their financial woes would worsen, as the state cooperation department had projected a 20-25 per cent fall in sugar production this crushing season, owing to a shortage of cane. So far this year, the state has produced 6.7 million tonnes (mt) of sugar by crushing 60.2 mt of cane. However, recovery fell from 11.35 per cent last year to 11.18 per cent.
"Cooperative factories have expressed their inability to pay 10 per cent of the amount demanded by the Income Tax department, especially at a time when sugar prices have fallen to Rs 2,960 a quintal, against Rs 3,400 a quintal during the commencement of the crushing season in November. The difference of Rs 440 a quintal has already impacted their finances adversely. In such a situation, factories won't be in a position to pay the first advance to sugarcane growers," Sanjeev Babar, managing director of the cooperative sugar factories' federation, told Business Standard.
Shetkari Sanghatana, an organisation of farmers, has opposed the Income Tax department's move to recover dues, saying this could lead to a severe law and order problem.
On condition of anonymity, the managing director of a cooperative sugar factory said the state government had repeatedly raised the issue with the finance ministry and the Central Board of Direct Taxes. "However, the recovery process has not been stayed, as the tax authorities have said the matter is sub judice �" cases are pending in the Supreme Court. The state government would have to make a fresh appeal for a stay on the recovery," he said.