Delhi govt asks R-Infra to pay Rs 129-cr tax

Reversing an earlier order of granting tax exemption to the tune of Rs 129 crore to Anil Ambani-led group company Reliance Infrastructure, formerly Reliance Energy, Delhi government has told the company to pay up the amount levied on it as sales tax.

The government has conveyed this to Delhi Lokayukta Justice Manmohan Sarin who was looking into a whistleblower's complaint alleging a Rs 129-crore scam involing tax liability against the company.

Following the government's stand, the Lokayukta today decided to close its probe into the complaint.

As per the Lokayukta order, Department of Trade and Tax has initiated "recovery proceedings" against Reliance Infrastructure Ltd, formerly Reliance Energy Ltd.

"In view of the setting aside of the order dated November 25, 2008, and restoration of the Assessment Order dated March 30 2006, there is no ground left for inquiring into the allegation of causing loss of Rs 129 crore to the state exchequer," the order said.

When contacted, R-Infra refused to comment on the issue. The Lokayukta had issued notices to the government last year after admitting the complaint by the anonymous whistleblower.

The tax department had in 2006 levied a liability of over Rs 129 crore on R-Infra. But responding to a plea by the company in November 2008, an Additional Commissioner of the Tax department had reviewed his earlier order and held that the appellant was entitled to exemption from sales tax.

This was in conflict with the stand taken by the Administrative department of the government before the Delhi High Court that the company was not entitled to such exemption.