Advance tax collections see muted growth in Sept quarter

MUMBAI: A steep fall in advance tax payouts by bad loan-saddled state-run banks has led to a muted 10.6% growth in overall revenue collections from large firms in the Mumbai zone in the September quarter.

Overall collections came in at ₹69,000 crore, as of September 15, even though other sectors like steel and even private sector lenders have done comparatively well, income-tax department officials said on Tuesday, declining to be named.

Unsatisfied with the collection, the department has asked its officials to keep a close vigil on the forthcoming quarterly results by large corporates.

Advance tax collections from the Mumbai zone, which is home to 45 of the top 100 companies and is responsible for one-third of total direct tax collections, were ₹62,370 crore a year ago.

State-run banks have not done well this time. In contrast, private sector banks have been okay when it comes to advance tax payment, sources said, adding however, other sectors like steel have done comparatively well in the September quarter.

While the country’s largest lender, State Bank of India, paid a whopping 37% less, foreign lender Citigroup also paid 34% less. In contrast, oil firm Hindustan Petroleum Co Ltd (HPCL) and steel giant Tata Steel Ltd saw their outgo jumping 70% each, while home loan firm Housing Development and Finance Corp. Ltd (HDFC) paid 10.47% more.

“Advance tax collection from the Mumbai zone is not satisfactory and hence the officials have been directed to maintain a constant vigil on quarterly results,” PC Mody, the newly appointed principal chief commissioner of income tax and head of the Mumbai zone, told PTI on Tuesday.

Overall, direct tax collections from the Mumbai zone grew 25% to ₹1.2 lakh crore as of 15 September from ₹96,000 crore a year ago. The Mumbai zone has a target of mopping up ₹3.16 lakh crore for the entire fiscal in direct taxes.