Star TV to shell out more money to IT Department

The channels of Star Television India Private Limited will have to shell out more money to the Income Tax (IT) Department than it has offered to pay. The Bombay High Court on Wednesday admitted the appeal filed by the IT Department against the order of the Settlement Commission allowing Star Group to pay Rs 1,300 crore and settle the matter.

Mohan Paearasaran and Beni Chatterji, counsel for IT, said that the Star Group disclosed Rs 150 crore later. Hence their first application was not true and did not give full disclosure, said Chatterji.

“If their entire revenue was considered then their dues would be over Rs 2,600 crore plus interest plus penalty. Hence the matter should not be settled by the Settlement Commission,” argued Chatterji.

There were numerous litigations pending against the Star Group with the IT Department with regard to taxable income of the 11 channels. The channels have not paid the income tax, stating that all of them are registered in the British Virgin Islands.

However, the IT department claimed that monies were being transferred from India. The Indian unit is collecting revenue to be transferred abroad, which ought to have been deducted as TDS as per the IT Act.

The group approached the Income Tax Appellate Tribunal (ITAT), which upheld the claim of the IT Department. The group approached the HC against the order of the ITAT.

Meanwhile, the group made an application before the Settlement Commission to settle the entire issue by offering to pay tax, which was 29 per cent of the revenue that was sent abroad.

According to Star, they had transferred Rs 5,000 crore abroad in July 2007 and were willing to pay Rs 1,300 crore. The Settlement Commission admitted the Star’s application, whereby the group would be let off after paying a little over Rs 1,300 crore.


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