The UK’s national broadcaster, British Broadcasting Corporation (BBC), is accused of tax evasion as per the material evidence found by the Income-Tax Department. The IT department’s action against BBC is based on material evidence, according to two officials from the Central Board of Direct Taxes (CBDT), who are aware of the development but asked to remain anonymous, as per the report.
The broadcaster must now adhere to proper procedures, which include submitting updated returns and paying any unpaid fees, fines, or interest. The BBC has also admitted that it may have underpaid its tax obligations. They have allegedly not reported Rs 40 crores income.
According to an email sent to the IT department, BBC admitted to underreporting their income, which was found equivalent to evading tax and is punishable by both recovery and fine. BBC must follow and comply with the legal process by filing revised returns and paying all dues, penalties, and interests, which is around in crores, as per the CBDT official.
A Senior official said that the UK government-funded broadcaster confessed to not reporting the Rs 40 crore of income in its tax returns, as per the email sent to CBDT. He states that the email doesn’t have any legal sanctity, and if BBC wants to be taken seriously, they need to file a revised return.
Another IT official asserted that neither media companies nor foreign entities would be given any preferential treatment under the law of the land, which is the same for everyone in the nation. The official states, “BBC must act as per the stated procedure or face the law. The Department will continue to take action against it until the matter is taken to the logical conclusion”.
The London-based broadcaster first attempted to give the idea that the Income-Tax Department’s action was the result of a vendetta by the government after airing a contentious documentary about the Gujarat riots.
The officials states, “Now, they informally accept they were involved in deliberate tax evasion and the action was against their unscrupulous behaviour”. As per the officials investigating the case states that the BBC is fully cooperating in the investigation and hopes the situation is resolved as soon as possible.
In February, the Income Tax Department conducted a survey operation at the BBC Delhi and Mumbai operations for tax evasion investigation. The department officials have seized phones and laptops as a part of the survey.
The department’s survey covers the business premises of the media giant and does not include the residencies of the corporation’s directors or promoters. The IT department alleged BBC has been non-compliant under transfer pricing rules; persistent and deliberately violative of transfer pricing norms.
Even the Enforcement Directorate (ED) filed a case against the BBC in April under the Foreign Exchange Management Act, 1999 (FEMA) for violation of Foreign Direct Investment (FDI) regulations issued by the Department for Promotion of Industry and Internal Trade (DPIIT). As per the official sources, the action was taken to probe irregularities of foreign funding by BBC India, diversion of funds and violation of rules under the FEMA, 1999.