Wednesday, April 5 2006 15:35 Hrs (IST) - World Time -

New Delhi: The Monopolies and Restrictive Trade Practices Commission has slammed auto giant Tata Motors for over booking and 'embezzling' Government money by retaining taxes at the time of mega-launch of its first car Indica in 1999.

It opened bookings from January 17-23, during which it received 1.13 lakh orders and collected Rs 32.16 billion. The amount included excise duty, sales tax and transportation charges, which the company did not submit to the government exchequer immediately.

"The realisation of sales tax and keeping the same with it not only amounts to unfair trade practice, but also amounts to temporary embezzlement of Government money," the Commission Bench headed by Justice B K Rathi said.

"The respondent has earned unlawful gains by realising this amount from the customers and not transferring the same to the government immediately," the Bench said.

MRTPC observed that at the time of launch the company had a production capacity of 10,000 cars in the first phase and planned to enhance it to 50,000 units in the next phase.

Later Tata motors (then Telco), returned the booking amount to 32,886 customers with 11 per cent interest after cancellation of their orders.

But three applicants whose orders were cancelled filed complaint in the Commission accusing that Tata Motors had no right to charge the entire price along with taxes before commencing production and the same should have been charged at the time of delivery.