News

16th June, 2006

Advance tax shows better health of India Inc

Advance tax collected by the income-tax department in Mumbai for the first quarter (April -June) of 2006-07 signals a marginal improvement in India Inc's performance.

According to preliminary data available with the income-tax department in Mumbai, State Bank of India continues to be one of the highest taxpayers and paid Rs 356 crore advance tax this quarter against Rs 280 crore in the corresponding quarter of last year.

The data, however, give a mixed picture of corporate sector performance in the first quarter. Engineering and construction major Larsen & Toubro has paid Rs 40 crore (Rs 25 crore), Tata Chemicals Rs 28 crore (Rs 25 crore), Indian Hotels Rs 13 crore (Rs 5 crore) and Hindustan Lever Rs 42 crore (Rs 35 crore).

Reliance Industries has paid Rs 212 crore, lower than Rs 241 crore paid in the corresponding quarter last year and Rs 220 crore in the fourth quarter and Tata Steel has paid around Rs 180 crore this quarter, sharply lower than Rs 265 crore paid in the first quarter of last year.

Mahindra & Mahindra has paid Rs 20 crore advance tax for the quarter, unchanged from the amount it paid in the corresponding quarter last year.

Similarly, there is no change in the payment of advance tax by Union Bank Rs 50 crore. Reliance Energy has paid Rs 20 crore advance tax in the April-June quarter. The corresponding figure is not available.

Overall, the tax department expects a shortfall in its advance tax collection for the first quarter of 2006-07 as Indian Oil, traditionally a leading tax-payer, is understood to have not paid advance tax.

Other state -run oil companies may also not be able to pay advance tax as they are reeling under international crude oil prices which have not been fully passed on to the domestic consumers.

Mumbai accounts for almost 50 per cent of the total income tax collection of the country.

The overall collection for the first quarter is slated to bearound Rs 20,000 crore, sources said.