Sahara’s expense claim to income tax panel is over 100 times its RoC filings

An email sent to Sahara India seeking details of revision in their expenses and the huge gap in reporting of expenditure between RoC filings and that provided to the tax authorities, went unanswered.

Written by Sandeep Singh , Ritu Sarin | Updated: January 13, 2017 1:09 pm
Sahara, sahara tax, sahara modi, Sahara immunity, sahara income tax, sahara papers, sahara papers seized, sahara raid, sahara penalty raid, income tax settlement commission, ITSC, sahara india, Income Tax Department, Sahara, Sahara India, Sahara India income tax, Sahara tax, Income Tax Settlement Commission, ITSC, Sahara company, Tax, Sahara tax, Registrar of Companies, sahara news, india news, indian express news An email sent to Sahara India seeking details of revision in their expenses and the huge gap in reporting of expenditure between RoC filings and that provided to the tax authorities, went unanswered. (Representational image)

SAHARA India’s claims of its expenses filed with the Income Tax Settlement Commission (ITSC) are more than 100 times higher than what it filed with the Registrar of Companies (RoC).

READ | Sahara gets immunity, tax panel accepts its claim that seized papers not evidence

This massive upward revision of expenses, experts said, helped the company avoid taxes on the Rs 1,771 crore that the ITSC decided was its additional income — for the period between 2008-09 and 2014-15 — on account of alleged unexplained cash receipts seized during search and seizure raids in November 2014.

WATCH VIDEO | Income Tax Panel Admits Sahara Fastest Disposal In 5 Years

A scrutiny of RoC records and the 50-page ITSC order, accessed by The Indian Express, reveals discrepancies. Consider the following:

* As against the total expense of Rs 2.9 crore reported by the company in its RoC filing for 2009-10, the Settlement Order notes that the operational expense for the company for that same year stood at Rs 400 crore.

* For 2010-11, the RoC filing shows an expense of Rs 3.08 crore. No corresponding figure is available in the Settlement Order.

* For 2011-12, RoC records show Rs 3.31 crore as expense but there is no corresponding figure in the Settlement Order.

* For 2012-13, RoC records show a total expense of Rs 38.3 lakh as against the expense of Rs 586 crore presented in the Settlement Order.

* While the total expense reported by the company with the RoC in the period between 2009-10 and 2012-13 aggregates to only Rs 9.7 crore, the aggregate of operational expense for four years (Assessment Years 2010-11, 2013-14, 2014-15 and 2015-16) provided in the settlement order amounts to Rs 2,173 crore.

Significantly, these revised expense figures exceed the total settled income of Rs 1,910 crore.

That’s why the company has been allowed to credit for, as the order puts it, for “loss up to 2013-14 in AY 2014-15 and 2015-16”.

Tax experts said that the Income Tax department uses its discretion on providing for deemed expense against the concealed income to the applicant and, therefore, in this case it may have accepted company’s revised expense figures against the concealed income.

Also Read | Same diaries flagged in PIL, Supreme Court said don’t see ‘smallest’ evidence

Said another top chartered accountant who did not wish to be named: “The objective of the revised and inflated expenses seems to be to set off the commissioned income. The point to raise is, whether expense audit was also carried along with the income audit, because, if the expenses are inflated then even if the concealed income is revealed, there will be no tax liability.”

An email sent to Sahara India seeking details of revision in their expenses and the huge gap in reporting of expenditure between RoC filings and that provided to the tax authorities, went unanswered.

On Thursday, The Indian Express had first reported that Sahara India has been granted immunity from prosecution and penalty in an ITSC order following raids conducted on November 2014 during which “diaries” listing alleged pay-offs to politicians were recovered.

Significantly, the ITSC has concurred with Sahara’s claim that the “evidentiary value” of the “loose sheets” recovered during the raids “could not be proved” by the Income Tax Department.

The order states that only Rs 137.58 crore — which was seized during the raids — will now be taxed. The company has been further allowed to pay the taxes, due on that amount, in 12 instalments.

The order shows that the ITSC had earlier rejected the application of the company and then on September 5, 2016 re-admitted it.

Also Read | Probe whoever is named in Sahara ‘diary’: Congress

The order reveals that the company made an error in its first application that led to it being rejected. While the minimum tax due should be Rs 50 lakh for an application to technically qualify for submission with ITSC, in the first application, the tax due fell short of that amount and hence the application was rejected on August 31, 2016.

However, within a week, the company submitted a second application where the tax due presented by the applicant was enhanced in a manner that it just crossed the Rs 51 lakh mark and thus could qualify for submission by ITSC.

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  1. S
    Sri
    Jan 6, 2017 at 6:29 am
    It would be useful if the paper clarifies its accusation and say what is owed by Sahara to IT based on the few bits of information it has acquired.
    Reply
    1. B
      Beware.and.act
      Jan 6, 2017 at 1:48 am
      IT department, CBI, IB, Enforcement Directorate, NTRO(digitoilet snooping agency of Indian toilets) are all 100% manned with brahmins deliberately appointed. lt;br/gt;lt;br/gt;Where there is a brahmin, there is a criminal!lt;br/gt;lt;br/gt;Similar period occurred in Germany for 100 years UNTIL 1945. After all aren't brahmins brother of Israelites!
      Reply
      1. I
        Inquilab Singh
        Jan 6, 2017 at 5:57 am
        IT, RBI, CBI, Delhi Police, NIA, EB, ACB, Judiciary, LGs in Delhi and Puducherry, all losing Cridibility one by one under Modi and BJP rule. Ordinary people losing all hope.
        Reply
        1. P
          PCKULKARNI
          Jan 6, 2017 at 3:48 am
          This IT tribunal has become another caged parrot
          Reply
          1. S
            SubbuI
            Jan 6, 2017 at 5:26 am
            2000 THOSAND CRORES NEW NOTES CAUGHT WITH MAHARAHSTRA LAW MAKER ONE GADGIL DARED PRESS AND ELECTRONIC MEDIA TO SHOW. WHAT HAPPENED THEN?lt;br/gt;NO CHARGE SHEET. NO ARREST. NO INQUIRY-ALL AMICABLY SETTLED ON BEHALF OF NALAYAK NMODI
            Reply
            1. S
              SubbuI
              Jan 6, 2017 at 5:31 am
              MAHESH SHAH DECLEARED 13800 THOSAND CRORES BLACK MONEY WITH THE NAMES. TAX MAN REJECTED THE NAMES WHICH INCLUDE BIG DON AND HIS FRIENDS. NO CHARGE SHEET. NO APPEAL, NO INQUIRY.CASE CLOSED.ALL BY ORDER FROM NALAYAK NMODI
              Reply
              1. S
                SubbuI
                Jan 6, 2017 at 5:22 am
                SAHARA RE SUBMISSION OF TAX PAPERS CLEARED IN 15 DAYS. REALY YOU MUST GIVE CREDIT TO I TAX DEPT. NOW NO CHARE SHHET. NO APPEAL,NO FURTHER INQUIRY.
                Reply
                1. M
                  Mathura
                  Jan 6, 2017 at 11:19 am
                  Who got real immunity SAHARA or its DIRECTORS or MODI the PM . Chor Chor Mausere Bhai
                  Reply
                  1. M
                    Mathura
                    Jan 6, 2017 at 3:00 am
                    So every thing can be settled if you can bribe the right man. only problem is identifying the Right man. Luckily sahara identified the right man in time who can broker truth with impunity. few lakhs expenses in ROC returns to thousand of crores expenses in IT revised returns.
                    Reply
                    1. A
                      adag
                      Jan 6, 2017 at 9:48 am
                      Seems a deal has been done. First evidence of settlement by BJP government......People should make it an issue on social media
                      Reply
                      1. S
                        sunny
                        Jan 6, 2017 at 12:54 am
                        SHARAH CHIEF WAS IN JAIL WHEN CONGRESS WAS IN POWER for 10000 cr fraud which he looted from common people in the name of housing and other schemes but he is free now
                        Reply
                        1. R
                          Rajiv
                          Jan 6, 2017 at 2:02 am
                          Wow ! Sahara , the 2nd greatest con company in India , has got a tax break ! lt;br/gt;lt;br/gt;Subrato Roy still has a lot of pahunch in the higher reaches of the govt
                          Reply
                          1. A
                            arc
                            Jan 6, 2017 at 7:27 am
                            Sanskair crooks aka Modi and Company now trying to save their munimji in whose trust they have kept their black money. Mood khata bhi hain our khane bhi deta hain.
                            Reply
                            1. A
                              a
                              Jan 6, 2017 at 5:23 am
                              It is XODI Court. Ruling if final !
                              Reply
                              1. M
                                mark
                                Jan 6, 2017 at 1:16 am
                                In context to this story, my request to BJP is that when you want to do a con job, do a better con job, apply some mind to it. lt;br/gt;lt;br/gt;Don't do a stupid con job like demonetisation.
                                Reply
                                1. M
                                  mark
                                  Jan 6, 2017 at 1:16 am
                                  So Modi set him free
                                  Reply
                                  1. R
                                    ramanujan
                                    Jan 6, 2017 at 12:22 pm
                                    Deliberately all comments against the article is being blocked by IE.. Good journalism..
                                    Reply
                                    1. R
                                      ramanujan
                                      Jan 6, 2017 at 5:39 am
                                      IE is in the habit of falsely spinning a story to make it sensational... How does a rag tag piece of paper become books of account... Inflating expenses is being repeatedly linked to notings in diary...which Supreme court has trashed.. Expect better journalism...please...
                                      Reply
                                      1. H
                                        harun
                                        Jan 6, 2017 at 4:12 am
                                        CBI.DRI/IT are all Independant and doing Great Job.lt;br/gt;lt;br/gt;Sahara if at all made contributions to Nationalists and Those who have dedicated their lives to Mother India.lt;br/gt;lt;br/gt;By accepting Sahara Statements of account the IT have done a fine Job.
                                        Reply
                                        1. A
                                          AntiWahhabi
                                          Jan 6, 2017 at 3:47 am
                                          Of course, that is why bribe was given to MODI for cover up and election funds...
                                          Reply
                                          1. M
                                            Manu USA
                                            Jan 6, 2017 at 1:49 am
                                            IMO, Indian Express is intentionally or unintentionally forgetting true neutral journalism.
                                            Reply
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