The taxation officers failed to realize tax/additional tax amounting to Rs. 1.44 crore from 440 vehicles which were surrendered for a period beyond three calendar months.
As per UPMVT Rules, 1998, if the owner of a transport vehicle withdraws his motor vehicle from use for one month or more, the certificate of registration, tax certificate, additional tax certificate, fitness certificate, and permit, if any, must be surrendered to the taxation officer. The taxation officer shall not accept the intimation of not using any vehicle for more than three calendar months, within a calendar year. However, the period beyond three calendar months may be accepted by the RTO of the region concerned, if the owner makes an application with the requisite fee to the taxation officer. If any such vehicle remains surrendered for more than three calendar months during a year without extension of acceptance of surrender by RTO, it shall be deemed to be revoked and the owner shall be liable to pay tax and additional tax, as the case may be. Further, subject to the provision of sub-rule (4), the owner of a surrendered vehicle in respect of which intimation of not using the vehicle has already been accepted, shall be liable to pay tax and additional tax for the period beyond three calendar months during any calendar year regardless of whether the possession of the surrendered documents has been taken from the taxation officer or not.
Audit test-checked the records of 1626 RTOs/ARTOs and noticed (between October 2018 and February 2020) that 440 out of 2,247 vehicles remained surrendered (January 2017 to November 2019) for periods ranging between four to 12 months in a calendar year. Though extension of acceptance of surrender beyond three months was not granted by the concerned RTOs, the taxation officers failed to initiate any action to realize the tax/additional tax due thereon. As a result, revenue amounting to Rs. 1.44 crore was not realized