Just 11 have MC property tax debt of Rs. 60L

Just 11 property owners in Ludhiana, both public and private, owe the Municipal Corporation (MC) about Rs 60 lakh in unpaid property taxes at what seems to be the height of default.

According to authorities, it makes up over 10% of the Rs 6.12 crore in arrears for property tax that the local body has not yet obtained from only 11 of the over 25,000 defaulters in the fiscal year 2023–24.

In spite of this, the MC set a kind of record when it collected the biggest amount of property tax to date—Rs 138 crore—in the previous fiscal year.

But according to the MC, more than 25,000 property owners still owing more than Rs 6.12 crore for the previous fiscal year.

As a result, there are now over 92,000 property tax defaulters in Ludhiana overall, and the arrears have increased to nearly Rs 14.71 crore.

The local authority has started a special effort to collect the arrears from individuals who had not cleared their dues despite repeated notifications and reminders after defaulters failed to do so by March 31.

In addition to imposing penalties and interest, the MC has the right to seize the assets of significant defaulters should they be unable to make the required payments on time.

The Tribune was informed on Friday by MC Commissioner Sandeep Rishi that a list of defaulters had been compiled and that new notifications were being sent to them requesting that they pay their debts as soon as possible. If they do not, the MC would have to take strong legal action to recoup the arrears.

He warned that serious and persistent defaulters would face harsh consequences. “The property owners, who have not yet deposited the property tax or other levies, should do it forthwith as they had failed to avail the waiver of penalty and interest offered until March 31,” he said.

He indicated that in addition to applying the fine and interest, legal action will be taken to attach the assets.

The MC prepared a list of major property tax defaulters as of March 31. The list included Samra International, which had the highest arrears of Rs 10.55 lakh; the District Administrative Complex (DAC), which houses the Deputy Commissioner’s office and other district department heads; Jagir Singh/Inder Singh; Upper India Steel Private Limited; Rs 7.41 lakh; AB Mehta Private Limited; Rs 4.64 lakh; SEL Manufacturing Company; Rs 3.85 lakh; GS Auto International; Rs 6.38 lakh; Central Jail; Gurdit Singh Jagmohan Singh; Rs 5.96 lakh; Harnek Singh; Rs 3.14 lakh; and Jasmel Singh owed the civic body a total of Rs 2.76 lakh through the end of the previous fiscal year.

Over 3.98 lakh property tax owners paid the levy during the previous financial year, according to the MC chairman, while over 25,000 assesses still owed the MC over Rs 6.12 crore for 2023–24. This was the local body’s highest-ever collections since the levy was implemented in 2013.

Breaking down the year-by-year property tax receipts, Rishi stated that during the 2013–14 financial year, property tax totals of Rs 137.7 crore, Rs 122.45 in 2022–23, Rs 92.84 crore in 2021–22, Rs 96.68 crore in 2020–21, Rs 84.25 crore in 2019–20, Rs 78.24 crore in 2018–19, Rs 70.4 crore in 2017–18, Rs 66.05 crore in 2016–17, Rs 69.44 crore in 2015-16, Rs 52.94 crore in 2014–15, and Rs 74.79 crore were collected from the property tax head.

Relevantly, the MC received income of Rs 708 crore from various sources in the just concluded fiscal year. This amount, however, was about 6% less than the revenue collections of Rs 752 crore reported in the fiscal year 2022–2023.

The property tax receipts saw a significant increase in revenue, reaching an all-time high of Rs 138 crore—a jump of more than 12% over the Rs 122 crore collected in 2022–2023—but the government’s failure to reimburse the VAT and GST for the most recent fiscal year resulted in a maximum income shortfall of Rs 44 crore.

Nonetheless, the total income collections for 2023–24 were a staggering 24% less than the updated expectations of Rs 927 crore that were set in the Budget for the preceding fiscal year. It resulted from a deficiency in receipts from five of the thirteen revenue categories in Ludhiana, which is a 169 sq km region with 16.18 lakh people living there as of the 2011 Census.

4.24L attributes

Property tax is assessed on 4,23,906 properties overall that are located inside the municipal borders. Through public notifications and private messages on their registered cellphone numbers, the MC had been reminding the owners of the 25,075 or so property owners who had been left out to pay the levy by March 31. However, they had not yet paid their dues.

What was beneficial

The civic body was able to achieve record collections under property tax and other seven heads in the fiscal year 2023–24 thanks to a persistent campaign to collect taxes, encouraging residents to pay levies, facilitating the collections through online platforms, keeping collection centers open even on public holidays, and, last but not least, issuing stern warnings to attach properties and initiate legal proceedings against defaulters.