Madras High Court issues notice to AR Rahman for alleged tax evasion

Guwahati: Oscar-winning composer AR Rahman been given a notice by the Madras High Court regarding a case filed against him by the Income Tax Department on September 11.

His charitable trust fund, AR Rahman Foundation, allegedly routed an income of over Rs 3 crore for tax evasion.

As per T R Senthil Kumar, senior standing counsel for the Income Tax department, Rahman had allegedly received a payment of Rs 3.47 crore in the year 2011-12 for making exclusive ringtones for a UK-based telecom organization. Rahman got the payments credited directly to his charitable foundation.

"The income which is taxable must be received by Rahman. After due deduction of tax, it can be transferred to the trust. But the same cannot be routed through the trust as income to the charitable trust is exempted under the Income Tax Act", The Income Tax Department counsel stated.

According to the IT department, since the charitable trust didn't have a permit under the Foreign Contribution Regulation Act, the amount of Rs 3.47 crore was taxable income and can't be considered as foreign contributions.

The case goes back to 2015 when the IT Department had first blamed Rahman for tax evasion. Rahman had moved the Income Tax Appellate Tribunal in Chennai against the order. In September 2019, the court had set aside the Income Tax procedures against AR Rahman and also said there was "nothing on record" to prove that the money was taxable. 

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