Superstar Shah Rukh Khan has got a big victory in a case related to income tax. The Income Tax Appellate Tribunal (ITAT) has stayed the order of re-assessment proceedings initiated by the Income Tax Department for the financial year 2011-12. The case is related to the tax credit paid in the UK on the earnings of the film Ra.One. According to the agreement between Shah Rukh and Red Chillies Entertainment, 70% of the film was to be shot in the UK. Therefore, 70% of the income was considered abroad, which was to be taxed in the UK. This also included with-holding tax. Shah Rukh had declared an income of Rs 83.42 crore from the film. The tax officer rejected his claim of tax credit paid in the UK. The income was reassessed as Rs 84.17 crore. Shah Rukh had claimed foreign tax credit in his original I-T return, which was rejected by the IT officer. The ITAT held that re-assessment after a period of 4 years was not legally justified. Bench declared re-assessment process invalid
ITAT’s Sandeep Singh Karhail and Girish Agarwal bench in its order declared the re-assessment process invalid. The tribunal said that the assessment officer could not provide any new concrete evidence for reassessment after the 4-year rule. The ITAT bench concluded that the re-assessment proceedings were legally wrong on more than one basis. It was not in accordance with the provisions of Section 147. Therefore, it was quashed. The tribunal did not find any evidence against Shahrukh. The IT officer had rejected the claim of foreign tax credit
Shahrukh’s payment was made through Winford Production, a UK company. Tax officials argued that India suffered revenue loss due to this payment arrangement. The IT officer had rejected Shahrukh’s claim of foreign tax credit. An Indian citizen has to pay tax in India on his global income. There is a provision of foreign tax credit in tax treaties. With this, Indian citizens can deduct the tax paid abroad from their Indian tax liability. By doing this one can avoid paying tax twice on the same income. ———————————————— Read this news related to Shahrukh Khan too… Shahrukh, Ajay, Tiger summoned in Jaipur Consumer Court: Notice to Chairman of Vimal Industries also; Allegation – misleading by claiming presence of saffron in Pan Masala Bollywood actors Shahrukh Khan, Ajay Devgan, Tiger Shroff and Vimal Kumar Agarwal have been summoned by Jaipur Consumer Court. Vimal Kumar Agarwal is the Chairman of JB Industries, the company which manufactures Vimal Pan Masala. It is alleged that people are being lured to buy Vimal Pan Masala in the name of saffron, while there is no saffron in it at all. Read the full news…
