On April 10, data compiled by the revenue department from its Online Tax Accounting System showed a shortfall of around Rs 6,000 crore (Rs 60 billion) in direct tax collection from the revised Budget estimate of Rs 1,70,077 crore (Rs 1700.77 billion).
The department had asked the finance ministry to request SBI to extend its book closure date beyond April 20 to ensure that all pending challans were cleared and recorded in fiscal 2005-06 instead of being carried over to 2006-07.
"While the demand for extension of the book closing date has not been accepted, an executive order has been issued that cheques which have not been cleared should be credited according to the dates on which they were issued," a senior finance ministry official told Business Standard.
The move is expected to provide a boost to direct tax collections since the SBI deals with a significant share of tax challans.
Officials pointed out that the usual practice among banks is that all tax-related cheques issued up to March 31 have to be cleared the same day. Once cleared, the cheques are entered for the concerned year within the book closing date.
As per estimates, the week-long strike by SBI from April 3-9 caused a delay in clearance of around 16 lakh cheques across the country.
Officials, however, admit that the final direct tax collection figures could still be Rs 3,000-3,500 crore (Rs 30 to 35 billion) short of the revised target.
Income tax collection (inclusive of fringe benefit, banking cash transaction and securities transaction taxes) as per OLTAS data up to April 10 was Rs 64,250 crore (Rs 642.50 billion) compared with a revised budget estimate of Rs 66,239 crore. Corporate tax collection was Rs 98,900 crore (Rs 989 billion) against a revised estimate of 1,03,573 crore (Rs 1035.73 billion).
After including other taxes, the total direct tax collection is only Rs 1,63,400 crore (Rs 1634 billion) compared with the revised estimate of Rs 1,70,077 crore (Rs 1700.77 billion). The collection on account of FBT was Rs 4,780 crore (Rs 47.80 billion), BCTT Rs 310 crore (Rs 3.10 billion) and STT Rs 2,560 crore (Rs 25.60 billion).
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