The Income Tax Appellate Tribunal in a ruling on Friday held the tax demand of around Rs 450 crore raised by the Income Tax Department in a case pertaining to a $150 million investment by US television network NBC in NDTV Networks — a holding company of NDTV — in 2008. Sources said the tax demand has been confirmed by the Tribunal and penalty proceedings will commence shortly.
“The investment of $150 million (Rs 654 crore as per 2008 conversion rate) in NDTV Networks under question and the Tribunal has confirmed our demand of around Rs 450 crore raised in the case,” a senior tax department official said. The tax official said that going ahead that NDTV will have the option to appeal the ruling “only for question of law but not question of fact”. Queries sent to NDTV remained unanswered. The copy of the order was not immediately available on Friday. The Income Tax Department had alleged that the TV channel had illegally routed money through NBC, then a GE subsidiary, via Bermuda and that NDTV had received this money through its shell company registered in Netherlands.
In June, NDTV, in a statement on its website, had said, “There is absolutely no undisclosed income. None at all. NBC, one of America’s largest and oldest TV networks (and a subsidiary of General Electric or GE at that time) invested $150 million in NDTV in 2008.
Five years later, India’s income tax authorities bizarrely – without any evidence — said the $150m investment: a) was a “sham transaction” b) NBC/GE were involved in “round tripping” c) NBC/GE acted as a front for “money laundering”.
“These are extremely serious accusations of criminal offences which would make NBC/GE CEOs liable to imprisonment. The Indian IT department did not have – and has yet to supply – any evidence to back these wildly dangerous accusations against GE which is a major US investor in India,” NDTV had said in its June statement.