Telangana to get back Rs. 1274 crores taken away from RBI by Income Tax Department
DDT reported this issue on 29.06.2015 - .
The income Tax Department had collected Rs. 1274 crores from the Reserve Bank of India belonging to the State of Telangana for the arrears owed by the AP Beverages Corporation of the erstwhile State of Andhra Pradesh.
DDT 2629 asked,
Understandably the State is worried; 1200 crores is big money even for a State. The State Chief Secretary and Finance Minister met the Union Finance Minister and urged him to ask the RBI to re-credit that amount to the State coffers. The State argues that RBI had transferred the money illegally and suddenly without any notice or court order.
What will the FM do? Will Telangana get its money back?
Yes! They are getting it back.
The Union Government has advised the RBI to reverse the amount without any prejudice to the rights of Income Tax. Further, RBI was advised to note that money from the Consolidated Fund of any State shall be transferred/withdrawn only after following the constitutional and legal requirements. (we reported this yesterday in our Mixed Buzz)
Does this mean that the action of the RBI in transferring the money to the Income Tax from the Consolidated Fund of Telangana was illegal/unconstitutional - as was the stance of the State Government?