This seems to have the makings of a political potboiler. The finance ministry has summoned the Railway Board chairman after rare surveys conducted by the revenue department revealed that India's largest departmental enterprise was not deducting tax in line with the norms. According to sources, the income tax department conducted surveys in Hajipur (Bihar) and Bhusawal (Maharashtra) and railways was found to be deducting less than what it should have. While the tax department's focus on TDS from the over 75 identified target groups has seen nearly 50% rise in mop up, as part of its revenue maximisation drive it discovered that the collections from the railways and defence had shown only marginal rise. TDS from the railways has increased by less than Rs 58 crore in the last four years, while the defence ministry has seen a Rs 90-crore rise between 2003-04 and 2006-07, sources said. "With a turnaround, railways is placing more orders and the defence ministry is also spending larger parts of its budget allocation. In this case collections should have increased. But that has not been our experience so far," an official said. This prompted the finance ministry to first seek an audit besides a training programme for officers. Simultaneously, the tax department launched surveys at the two railway centres, while sparing the defence ministry since it was seen as "sensitive". If the surveys were not unique, finance minister P Chidambaram has decided to deal with the issue with the Railway Board chairman himself. A Central Board of Direct Taxes official, however, dismissed the summon as just another event saying that the revenue department was only trying to educate the railway department since at times the deductor does not deal with all circulars and guidelines. "There could be an element of ignorance and finance ministry is only pointing it out," said an official. The finance ministry is not entirely pleased with the way things are taking shape. For instance, North Block pointed out that the cost estimates for the freight corridor were underestimated. Though the finance ministry has left no opportunity for raking in additional money, be it through higher dividends, the expenditure department also complains of not getting proposals on time. On its part, railways, headed by a political heavyweight like Lalu, is asserting itself all the time, threatening to plough back profits to develop projects on its own. – www.economictimes.com