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Journalism of Courage
NEW DELHI, MARCH 17: The Income Tax department has detected that the Bank of Tokyo-Mitsubishi has allegedly evaded taxes to the tune of Rs 50 crore in its Indian operations. Besides, Hyatt Hotel has been found to have evaded taxes to the tune of Rs three crore and Samsung Electronics to around Rs one crore, a senior IT department official said here today.
The offices of the three companies have been surveyed and irregularities detected, the official said. Notices have also been issued to these companies, who have not been complying with tax deduction at source (TDS).
This comes close on the heels of the around Rs 50-100 crore evasion on TDS by Suzuki Motor Company (SMC) officials and nominees in the Rs 8,500 crore Maruti Udyog Limited (MUL).
The official stated that the IT departments of Delhi, Gurgaon and Faridabad are working jointly to crack down on major corporate houses who are evading taxes by not declaring the income of their foreign employees in Indian operations.
Regarding the investigationsof Suzuki employees, the official said summons have already been issued to all senior directors, including MUL chairman Yoshio Saito on suspicion of tax evasion via under-declaration of their foreign income received in Japan. “We were to commence questioning today, but so far, no one has reported to us.”
It has been established that Suzuki officials working with MUL are getting two salaries — one paid by MUL in Indian rupees and the other paid by SMC in Japan. As per Indian Income Tax law, foreigners working in India have to file a declaration of any income earned by them abroad with their Indian employer. The Indian employer is then responsible for deducting tax at source on the total income of the foreign employee.
Though some of the Japanese employees have been declaring some foreign income to MUL, no such declarations were being filed prior to 1995. Further, it was also found that there was gross under-declaration of the foreign income by these employees.
The official further stated that despitehaving asked Saito to be available in office for questioning, he quietly left for Japan the same day. He had come to Delhi to attend the MUL board meeting on Monday and was originally supposed to be here till tomorrow. The surveys were conducted under Section 133-A of the IT Act.
