New Delhi, Oct 18 (IANS) The union cabinet Saturday approved a proposal of the department of telecommunications to provide financial support to Mahanagar Telephone Nigam Limited (MTNL), an official statement said here.
The MTNL needs financial support due to its liability arising from levy of minimum alternate tax (MAT).
“The objective of this approval is to provide one time financial support to MTNL due to reimbursement of MAT during the financial year 2014-15 through requisite budgetary provisions,” the statement said.
“On account of recent decisions of the government which includes payment of pension to erstwhile government employees absorbed in MTNL and who opted for combined service pension and financial support on surrender of Broadband Wireless Access spectrum, MTNL has earned a book profit of Rs.2,348.49 crore for the FY 2013-14, resulting in a minimum alternate tax liability of Rs.492.26 crore,” it added.
The decision will help MTNL arrange finances to meet its basic financial commitments like operations and maintenance of its telecom network.