BHUBANESWAR: The Odisha government has asked the Indian Oil Corporation Limited (IOCL) to pay Value Added Tax (VAT) worth Rs 215.31crore which the corporation has ‘unilaterally’ withheld for the period from December 2015 to March 2016.
“The said non-payment of VAT is in violation of the tax collection mechanism prescribed under Odisha Value Added Tax Act,2004. It not only causes an adverse impact on the finance of the government of Odisha but also vitiates the general public interest,” said the Finance Department in a letter to Executive Director, IOCL.
In its letter to IOCL, it said that the ‘working group’ formed to relook into various fiscal incentives that were extended to IOCL for its refinery project at Paradip held a meeting April 28 this year.
“While the working group is seized of the matter and a resolution is pending, IOCL has unilaterally withheld the VAT collections to the tune of Rs 215, 31, 25, 005 for the tax periods from December 2015 to March 2016,” read the letter.
It further said that state government reiterates its commitment to discuss amicably and resolve the issue of re-looking into the incentives extended to the IOCL within the framework of the working group.
However, in the interim, IOCL should deposit the VAT collected on the sales in accordance with the provision of OVAT Act.