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Mumbai: Court acquits Nadiadwala in delayed TDS payment case

It held that there was no evidence to prove the TDS default summary submitted before court, as it did not bear any seal or sign of the department. It was said that sanction order was “mechanically” passed to prosecute the accused.

By: Express News Service | Mumbai |
January 16, 2021 12:51:40 am
Feroz Nadiadwala, Feroz Nadiadwala TDS payment case, TDS payment case, Feroz Nadiadwala acquitted, indian express newsFeroz Nadiadwala. (File)

Film producer Feroz Nadiadwala was acquitted last week by a metropolitan magistrate’s court from proceedings filed by the income tax department alleging delay in payment of TDS (tax deducted at source). The court said the I-T department had failed to prove that delay was caused without any reason. It considered Nadiadwala’s submission that he suffered losses due to a film being shelved and another banned in some states. The court said while Nadiadwala had tried to compound the case in 2013, the department had not agreed to do so.

“According to Shriraman (chief witness and I-T officer), the chartered accountant of the accused brought to the notice of the department about payment of interest, compound fee and legal fee. He further says that despite payment of the compounding and legal fee, the department did not compound the case of the accused. Thus, the arbitrariness of the concerned commissioner of income tax is seen clearly,” it added.

It held that there was no evidence to prove the TDS default summary submitted before court, as it did not bear any seal or sign of the department. It was said that sanction order was “mechanically” passed to prosecute the accused.

An offence was filed against Nadiadwala alleging that for the financial year 2010-11, he had delayed payment of the amount for over a year. The I-T department had claimed that tax of Rs 3.55 lakh was deducted on payment to contractors as per Income Tax Act but it was not deposited to the government within the required time.

Nadiadwala in his defence said he had been informed by his auditor regarding the pending dues, after which he immediately arrang-ed for it to be paid and so, there was a delay. He said that in 2010, shoot for a film called Power, which he was producing, was stopped after 10 days, causing a loss of Rs 11.5 crore. Another film, Aarakshan – directed by Prakash Jha – could not be released across India that year as it was banned in some states. Nadiadwala said this also led to him suffering losses of Rs 20 crore.

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