Punjab minister Navjot Singh Sidhu on Thursday claimed that show cause notices have been issued to Fastway Transmission Pvt limited (FTPL), a multi-system operator in cable business, by the director general of GST Intelligence for allegedly evading service tax amounting to Rs 2,100 crore.
He alleged that the previous SAD-BJP regime had provided monetary benefit of Rs 5,000 to Rs 7,000 crore to the company by illegally monopolising cable business in Punjab.
Releasing the copies of the show cause notices to the media, Mr Sidhu further claimed that the central agency acted against the private company offering cable services in Punjab after he highlighted the massive tax evasion last year.
However, FTPL, in a statement, accused the Punjab cabinet minister of "twisting facts and making false statements", mainly to "score his personnel vendetta".
At a press conference in Chandigarh, Mr Sidhu said, "DG of GST Intelligence initiated a probe into the matter after I highlighted it in the media. It has served show cause notices to the owner of Fastway for evading service tax for period 2013 till 2018."
The show cause notices were also issued to the company's chartered accountant, CEO, other officials and local cable operators regarding "tax evasion", he claimed.
Mr Sidhu said the owner of the company has been asked why the tax amount should not be recovered from them along with interest and why penalty should not be imposed upon them.
He claimed that the Punjab government was entitled to get a share of 62 per cent out of this tax amount.
"With these notices, my stand is vindicated (on cable mafia)," Mr Sidhu claimed.
"This financial irregularity was not a small one. Thousands of crore of rupees went into the pockets of private people. May be, it (this practice) is still going on now. Our government will see into it," the Punjab Local Bodies minister said.
Mr Sidhu had last year alleged that cable operators were evading service tax to the tune of Rs 2,600 crore, and had thrived under the "patronage" of then SAD-BJP government.
He had also charged the private cable service operating company with "under declaring" the total number of cable operators being handled by it and subscribers to evade taxes and monopolizing cable business in Punjab.
Asked about the fate of the notices issued to the company, Mr Sidhu said the case was pending adjudication.
"Hearings were given to the cable operator," he said and alleged that the company was adopting delaying tactics.
According to a statement issued by the company, "Service Tax matter of Fastway Transmission Private Limited (FTPL) was investigated by preventive wing and intelligence wings of the Department.
"After long-drawn investigation by the competent investigation agencies department issued an SCN (show cause notice) on January 1, 2018 through which the liability of LCO (Local Cable Operator) was fastened on FTPL.
"No evasion of tax was ever noticed by investigation teams. GST/Service tax department has not quantified or confirmed any tax liability on the company. It is purely a legal and procedural issue and to be settled by competent courts at the national level. Process of adjudication of SCN is under process," it said.
"Fastway is a tax and law-abiding company and never evade any single paisa of tax. Fastway has remained regular in deposit of its taxes and has never evaded any tax of any nature," it further said.