In a marker of its intention to take stringent action against property tax defaulters, the Kathmandu Metropolitan City on Thursday padlocked the office of the Thapathali-based Kanchanjungha Housing at Trade Tower which is responsible for the overall operation of the complex.

The Tower which currently houses some 25 entities including banks and colleges had ignored the metropolis' repeated calls and warnings to clear the pending house and land taxes.

Following the action, the KMC has granted an additional one week for the housing company to clear outstanding taxes. If ignored again, the metropolis plans to seal all other businesses currently housed in the complex and also padlock the entrance to the building.

Revenue Department Chief at the KMC, Mahesh Kafle said they were forced to shut the office, tired of sending numerous letters asking and warning it to clear the outstanding dues which were repeatedly ignored and challenged.

“This was our last resort to recover our dues,” said Kafle. The Local-self Governance Act (1999) authorises the metropolis to padlock, freeze and auction the properties of the defaulting parties to recover the taxes.

A representative at the Trade Tower, Binay Upadhyay said KMC officials and city police mandhandled their staff during the sealing process. “The so-called officials didn't have any official document, yet they pushed our staff. They didn't act like officials, rather like goons,” said Upadhyay. Kafle denied the charge and said everything was in order.

Two weeks ago, the metropolis dispatched its final letter to the company to clear its house and land taxes which crossed Rs 10 million. The company replied that it was willing to pay the business tax but not the house and land taxes, arguing that Trade Tower had been leased out by the Nepal Food Corporation and it was responsible for these taxes.

The KMC, however, said the deal between the housing company and the NFC is not clear as to who pays the property taxes. Considering the permit taken by the company from the KMC for Trade Tower construction, the housing company was more responsible to clear the taxes.

After its tax recovery campaign launched in January, this is the first action taken by the metropolis against any defaulter. Other prime properties being pressed by the KMC to clear dues include RB Complex, Karmachari Sanchaya Kosh and KL Tower, each of which has about Rs 1.5 million to pay in taxes. The Nepal Electricity Authority has Rs 120 million to clear

source/photo courtesy: the kathmandu post,11 april 2014