Reply Notice Demand Letter

Sample Template Format of Reply Letter against Demand Notice from Water Tax / Income Tax / Sales Tax Department in India

The Director
Water Services
Office of the Engineer-in-Chief,
Water Resources, Khapoli
Maharashtra – 448 545

Dear Sir,

Ref : Your letter No.************* dtd.19.03.13

Sub : Demand Notice Number 001 dated 07.03.13 of the Executive
          Engineer, Khapoli Irrigation Division, Maharashtra

This draws reference to Bill for arrear Water Tax raised for purported amount of Rs.50,00,000/- for the period from October 2011 to February 2013 as per Demand Notice No.001 dtd.07.03.13 of Executive Engineer, Khapoli Irrigation Division, enclosed with your above letter.

In this connection, we draw your kind attention to Memo No.*********** dtd.29.05.05 from the then Joint Secretary to Government of Maharashtra to the Collector of Khapoli regarding supply of Water from River Mahanadi to our factory premises at Khapoli (Maharashtra) by which we were allowed to draw (allocated) water @ 2.5 Cusecs and as per Clause No.9 of the letter water charges @ Rs.30/- per 100,000 (One lac ) gallons were leviable on water actually drawn by us or at such rate as may be prescribed by Government from time to time and which was to be binding on our company.

The above rates were revised from time to time and such revisions were within marginal limits. For instance, such rates as effective prior to 01.10.11 in respect of water allocated below 50 cusecs were Rs.60/- per 100,000 (One lac) Gallons on the quantity of water actually drawn i.e. after an interval of about 5 years the rates were increased only by 2 times of the rates existing in 2005.

However, such rates were revised upwards to Rs.5.40 per 1000 liters from 01.10.11 for water actually used and consumed for industrial and commercial purpose and when converted to 100000 gallons, the increased rate worked out to Rs.540 or about 9 times more than the earlier rates.

As our initial allocation was 2.5 cusecs which was the highest/upper limit upto which we could draw water but the actual consumption being less then that the levy according to us being on actual consumption, the actual effect should have been limited to revised rates as applicable to actual consumption i.e. @ Rs.540 per 100000 gallons. Accordingly, we clarified about the differential payable by us vide our letter dtd. 01.12.2011 addressed to the Executive Engineer, Khapoli Irrigation Division (copies of letter dtd.01.12.11 and 17.05.12 are enclosed and collectively marked as Annexure-A)

We were, however, surprised to receive letter No.*** dtd.25.03.12 of the Executive Engineer, Khapoli Irrigation by which we were asked to pay Rs.50,00,000/- for the period from October 2011 to February 2012 @ Rs.10,00,000/- per month on the new basis of allocated quantity of water being below 2.5 cusecs for which we came to know then for the first time. As our actual consumption was about ¼ of the allocated quantity and we were since start (i.e. 2005) being charged on actual consumption irrespective of the allocated quantity, we requested to the Addl. Secretary to the Government of your department vide our letter dtd.31.03.12 (copy enclosed as Annexure-B) to charge us on the drawal /consumption basis till new agreement was signed. From the terms of the agreement signed by us in July 2012 it will also be seen that the same is applicable from 19.07.2012 and therefore, it should not be enforced with retrospective effect.

In the facts and circumstances stated above, when the new basis actually came to our notice only towards the end of March 2012, we request you to revise the demand and make it effective from the date of agreement or alternatively atleast from April 2012 on or just before which it came to our notice, in the interest of equity and natural justice.

You will please appreciate that due to improvement in our consumption pattern on account of various steps taken by us to reduce water consumption / abate pollution we have been able to reduce such consumption/discharge of pollutants and we request you to revise our areement by reducing the allocation of water from 2.5 cusecs to 0.5 cusecs with immediate effect and revise the agreement accordingly.

On the checking of the Demand Notice, it is observed that there are clerical errors as some payments made by us are not reflected properly and which should be properly checked and rectified.

We, therefore, request you to
(a)    Charge us on the basis of allocated quantity of water only and without involvement of any interest payment with effect from 19.07.12 (i.e. the date of agreement) and prior to that to charge us on the basis of actual consumption of water or alternatively to give effect to the same from April 2012 when it first came to our notice.
(b)    Revise the agreement to read the allocated quantity to 0.5 cusecs in place of 2.5 cusecs with immediate effect and confirm the same to us.
(c)    Also check the demand for errors of omission and commission and submit the revised demand.

In case any information or explanations are desired from our side or any other formalities are to be complied with by us in the above matter, kindly inform us.

Thanking you,

Yours faithfully
For Rocket Sales Ltd.

Neetu Singh
General Manager (Accounts & Finance)

Encl. As above

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