Oscar-award winner, AR Rahman is in legal trouble. The Income Tax Department has approached the Madras High Court alleging that the singer has routed his income of over Rs 3 crore through a charitable trust to evade paying taxes. The composer manages charitable trust.
In lieu of the same, The High Court has issued a notice to Rahman asking him to explain the charges placed against him. The bench that issued the notice consisted of Justice TS Sivagnanam and Justice V Bhavani Subbaroyan.
As per a report in The Times of India, TR Senthil Kumar, senior standing counsel for the Income Tax department, alleged that Rahman received an income of around Rs 3.47 crore from the United Kingdom’s Libra mobiles in the assessment year of 2011-’12. Under the three-year contract with the mobile brand, Rahman was to compose exclusive ringtones for them.
Kumar alleged that AR Rahman had instructed the company to make the payment directly to his AR Rahman Foundation. Kumar was quoted by TOI saying, “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.”
According to a report in The News Minute, the Income Tax department said that since the charitable trust, AR Rahman Foundation, did not have a licence under the Foreign Contribution Regulation Act at that time, the amount was taxable income. In 2015, the Income Tax Department had first accused Rahman of tax evasion. In February this year, the Centre granted the AR Rahman Foundation the FCRA license.