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Annexure - A: Tax Evasion Noticed in CWG 2010

Tax Evasions Noticed by CVC
Compliance Amount (Rs. in Lac)
Worker Welfare Cess 10054.86
VAT on Work Contract - TDS 70168.05
Service Tax 24149.67
Income Tax/TDS 3864.95
Total 108237.532
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Annexure - B: Tax Status at a Glance

Tax Evasions Noticed by CVC
Compliance Amount (Rs. in Lac)
Worker Welfare Cess 10054.86
VAT on Work Contract - TDS 70168.05
Service Tax 24149.67
Income Tax/TDS 3864.95
Total 108237.532
Show cause Notices Issued
Compliance Amount (Rs. in Lac)
Worker Welfare Cess 8454.86
VAT on Work Contract - TDS 70168.05
Service Tax 22811.74
Income Tax/TDS NIL
Total 101434.652
Recovery Notices
Compliance Amount (Rs. in Lac)
Worker Welfare Cess 255.27
VAT on Work Contract - TDS 50470.17
Service Tax NIL
Income Tax/TDS NIL
Total 50725.44
Recovered
Compliance Amount (Rs. in Lac)
Worker Welfare Cess 4181.16
VAT on Work Contract - TDS 71.16
Service Tax 5221
Income Tax/TDS NIL
Total 9473.32

                                                                                                * The amount includes penalties also.
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Annexure - C: Income Tax

Income Tax TDS Information Sheet
S. No. Organisation Awarded
Cost		 Tax
Discrepancy
Noticed		 Show
cause
notices		 Recovered
1 Organizing Committee 135001 718.38 - -
2 Prasar Bharati 33570 120 - -
3 Mahanagar Telephone Nigam Ltd. 38719 664 - -
4 New Delhi Municipal Corporation 117092 500 - -
5 Delhi Police 10755 178 - -
6 Broadcasting Engineers Consultant India Ltd. 3023 22.91 - -
7 Electronics Corporation of India Ltd. 12632 773.81 - -
8 Ministry of Information & broadcasting 3100 78.86 - -
9 Delhi University 27150 725.85 - -
10 Jamia Millia Islamia 4157 83.14 - -
Total 385199 3864.95 - -
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Annexure - D: Service Tax

Service Tax Information Sheet
S. No. Organisation Awarded
Cost		 Tax
Discrepancy
Observed		 Show
cause
notices		 Recovered
1 Central Public Works Department 214390.92 490.11 5221
2 Organizing Committee 135001 1032.47 218.4
3 Municipal Corporation of Delhi 75195 1682.83 4210.23
4 Prasar Bharati 33570 197.72
5 Mahanagar Telephone Nigam Ltd. 38719 996
6 Delhi Police 10755 139.77
7 Broadcasting Engineers Consultant India Ltd. 3023 27.17
8 Electronics Corporation of India Ltd. 12632 1160.7
9 Ministry of Information & broadcasting 3100 80.8
10 Delhi University 27150 814.5
11 Jamia Millia Islamia 4157 124.71
12 DDA Games Village project with EMAAR MGF 160000 17893 17893
Total 717692.92 24149.67 22811.74 5221
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Annexure - E: VAT on Work Contract

VATon Work Contract -TDS Information Sheet
S. No. Organisation Awarded
Cost		 Tax
Discrepancy
Observed		 Show
cause
notices		 Recovery Notices
1 CPWD 214390.92 6803.61 6803.61 6803.61
2 Organizing Committee 135001 14812.08 14812.08 48.74
3 MCD 30395 4371.34 4371.34 4371.34
4 Delhi Development Authority 98371 166.45 166.45 -
5 Prasar Bharati 33570 1323.34 1323.34 -
6 Mahanagar Telephone Nigam Ltd. 38719 7795.75 7795.75 7795.75
7 New Delhi Municipal Corporation 117092 1000 1000 -
8 PWD 4971.44 7.87 7.87 7.87
9 Sports Authority of India 5391 617.44 617.44 -
10 Delhi Police 10755 272.14 272.14 -
11 Engineers India Ltd. 72863 1.51 1.51 -
12 Electronics Corporation of India Ltd. 12632 78.25 78.25 -
13 Ministry of Information & broadcasting 3100 107.73 107.73 -
14 Delhi University 27150 1193.89 1193.89 -
15 Jamia Millia Islamia 4157 173.79 173.79 -
16 DDA Games Village project with EMAAR MGF 160000 31442.86 31442.86 31442.86
Total 968558.36 70168.05 70168.05 50470.17
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Annexure - F: Worker Welfare Cess

Worker Welfare Cess Information Sheet
S. No. Organisation Awarded
Cost		 Worker Welfare Cess
Discrepancy
Observed		 Show
cause
noticed		 Recovered
1 Central Public Works Department 214,390.92 1,500.73 1,500.73 -
2 Organizing Committee 135,001.00 945.01 945.01 -
3 Municipal Corporation of Delhi 75,195.00 526.37 526.37 380.16
4 Delhi Development Authority 98,371.00 58.60 58.60 970.34
5 Prasar Bharati 33,570.00 234.99 234.99 -
6 Ministry of Youth Affairs & Sports 305.00 2.14 2.14 -
7 Mahanagar Telephone Nigam Ltd. 38,719.00 271.03 271.03 -
8 New Delhi Municipal Corporation 117,092.00 819.64 819.64 24.00
9 Indian Tourism Development Corp. 13,121.00 91.85 91.85 -
10 RITES Ltd. 3,091.00 21.64 21.64 -
11 Telecommunication Consultants India Ltd. 8,295.00 58.07 58.07 -
12 Sports Authority of India 5,391.00 37.74 37.74 -
13 Delhi Jal Board 6,782.00 47.47 47.47 -
14 Delhi Police 10,755.00 75.29 75.29 -
15 Broadcasting Engineers Consultant India Ltd. 3,023.00 21.16 21.16 15.00
16 Indian Railways Catering & Tourism Company Ltd. 1,568.00 10.98 10.98 -
17 Engineers India Ltd. 72,863.00 510.04 510.04 76.00
18 Govt. of National Capital Territory of Delhi 12,804.00 89.63 89.63 -
19 Electronics Corporation of India Ltd. 12,632.00 88.42 88.42 -
20 Ministry of Health & Family Welfare 205.00 1.44 1.44 -
21 Delhi Transco Ltd. 9,240.00 64.68 64.68 1.52
22 Delhi Transport Corporation 204,329.00 1,430.30 1,430.30 -
23 Ministry of Information & broadcasting 3,100.00 21.70 21.70 -
24 Public Woks Dept 217,108.00 1,519.76 1,519.76 763.40
25 Delhi University 27,150.00 1.90 1.90 -
26 Jamia Millia Islamia 4,157.00 2.91 2.91 -
27 Delhi State Industrial And Infrastructure Development Corporation 196.00 1.37 1.37 -
28 DDA Games Village project with EMAAR MGF 160,000.00 1,600.00 1,600.00
29 Other Recovered Amount(Organization-wise recovery yet to be received.) 1,950.74
Total 1,488,453.92 10,054.86 8,454.86 4,181.16
Recovery Certificates amounting to Rs. 2,55,26,868 has been issued in addition to above.
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Annexure-G :Tax Evasion

No tax was deducted while making advance payments to the contractor as per contractual provisions. While making subsequent payments, the advance was adjusted but tax was not deducted again. In some cases, tax was not deducted on advance payments even while making the full payments. In this regard, few cases of Tax anomalies' can be cited as under:

Case-1

                In a contract worth Rs.390 Cr., it was seen from the information uploaded on CVCMARK, that no taxes were deducted. As the contract does concern Income Tax, WCT, Labour Cess etc., a payment of the amount of Rs.332 Cr. were made without any tax deductions. While this issue was examined along with sales tax department of GNCTD, new facts cropped up such as wrong issuance of Form-C by the concerning department to the contracting agency. Sales Tax Department has issued a recovery notice of almost Rs.80 Cr. in this case.

Case-2

                In another contract valued at Rs.650 Cr., almost 40% payments amounting to Rs.250 Cr. (approx.) were paid to the agency, but no VAT on works contracts (WCT) and workers welfare cess were deducted. Workers Welfare Cess @ 1% of the payment amounting to Rs.2.5 Cr. and WCT @ 2% amounting to Rs.5 Cr. are yet to be recovered. Both the authorities have issued show cause notices to the department concerned.

Case-3

                In this case, the Worker Welfare Cess to the tune of Rs.17.33 Cr. was deducted by the principal organizations from their contractor’s bills, but not deposited to the labour department. After getting a show cause notice from the labour department, the amount of Rs. 17.33 Cr. was deposited by the organisation

Case-4

                The Worker Welfare Cess was not deducted from the payment made to the contractor.When show cause notice was issued by the Labour Department, an amount of Rs.85 lakhs (approx.) was deposited by them. On examining the details, it was found that 1% of the total contract value was paid to the contractor instead of deducting the same from contractor’s payments. This leads to an excess payment amounting to Rs.2.30 Cr. made to the firm.

Case-5

                This is a case of the worth of Rs.370 Cr. In this case, no tax was deducted on the payments made to the firm on the plea that it was a supply contract. But the nature and scope of the contract involved all- supply, erection, installation, testing, commissioning and maintenance etc. This contract attracted Income Tax, VAT, Service Tax and Worker Welfare Cess etc. which approximately amounts to 10% of the contract value i.e. Rs.37 Cr. (approx.). So the case was forwarded to all concerned tax authorities for further necessary action.

Case-6

                In a turnkey project of Rs.30 Cr., only income tax was deducted and no other taxes were deducted on the payments made to the contractor on the plea that it will get the taxes deducted on other contracts assuring that there will be no responsibility of tax compliance by the principal organization. In this manner, there was a tax evasion to the tune of approx. Rs.1.8 Cr. The case required further probe and scrutiny. That's why; it was forwarded to all the concerning tax authorities for further necessary action.

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