I-T dept’s exemption wing summons Tata Trusts officialshttps://indianexpress.com/article/business/business-others/i-t-depts-exemption-wing-summons-tata-trusts-officials/

I-T dept’s exemption wing summons Tata Trusts officials

A 2015-16 PAC report had said that the I-T dept “allowed irregular exemptions to Jamshetji Tata Trust and NavajbaiRatan Tata Trust...”

The exemption wing of the Income Tax (I-T) department has summoned Tata Trusts officials, said the trusts’ spokesperson on Friday. However, the spokesperson declined to specify the reason. “The tax department met the officials of Tata Trust today (Friday). The Tata Trusts are exempt from income tax under the laws,” said the spokesperson.

While The Indian Express could not ascertain the nature of the issue that prompted the I-T summon, a 2015-16 report by the Public Accounts Committee (PAC), titled Exemptions to Charitable Trusts and Institutions, said an audit has found that the I-T department “allowed irregular exemptions to Jamshetji Tata Trust and Navajbai Ratan Tata Trust who invested Rs 3,139 crore in prohibited modes arising from accumulations of capital gains which involved tax effect of Rs 1066.95 crore”.

“The Committee observe that in Maharashtra, DIT-E, Mumbai where Jamshetji Tata Trust and Navajbai Ratan Tata Trust earned Rs 1,905 crore and Rs 1,234 crore, respectively, on account of capital gain during AY2009 and AY2010 and invested the same in prohibited mode of investments which is in contravention to the provisions of section 13(I) (d) of the Act,” said the PAC report. However, the report said the ministry has taken remedial action in the case.

“In this regard, the ministry has apprised the committee that in case of Jamshetji Tata Trust, remedial assessment for AY 2009-10 was completed on November 3, 2011 u/s 143 (3) of the Act raising demand of Rs 330.14 crore. The assessment for AY 2010-11 was completed in regular course u/s 143 (3) of the Act on March 30, 2013, raising a demand of Rs 300.21 crore. Further, in the case of Navajbai Ratan Tata Trust, the assessments have been reopened by issuing notice u/s 148 for AY 2009-10 on May 14, 2013 and for AY2010-11 on January 20, 2014,” the report said.