Delhi Airport faces alleged service tax evasion charge

The Delhi International Airport Private Limited (DIAL) has come under the scanner of central revenue department officials for allegedly evading service tax of about Rs 60 crore or Rs 600 million.

It is alleged that DIAL, operator of Indira Gandhi International Airport (IGIA), evaded service tax on the licences fee and development charges collected by it from private entities who are developing five star hotels under the Delhi aerocity project, official sources said. A case of alleged service tax evasion against DIAL has been registered by the Directorate General of Central Excise Intelligence (DGCEI) here and the amount of alleged service tax evasion is about Rs 60 crore, the sources said.

They claimed that DIAL, which had been given about 5,000 acres land in and around the Delhi airport, leased out part of this land to private groups for development of hotel properties under the aerocity project without paying the service tax on the fees collected from them. When contacted, DIAL contended that no service tax is payable by them in the matter.

"DIAL is regularly paying the service tax on the licence fee received by it from all the developers. DGCEI query pertained to the service tax payable on advance development cost collected from the developers for the development of common facilities such as utilities, roads, sewage, security, etc. "

As these facilities are being developed for common use, hence DIAL has informed DGCEI that no service tax is payable on the same," a DIAL spokesperson said in his response to a PTI query.

DGCEI officials have also quizzed certain DIAL personnel in this regard, the sources said. DIAL is a joint venture consortium of GMR Group, Airports Authority of India, Fraport and Malaysia Airports Holdings Berhad.