Young Tiger NTR who is currently busy with the shooting of much-anticipated film “Jai Lava Kusa” is going to receive a shock from Income Tax Department. The news is that the Central Revenue department is gearing up to serve notices to NTR on based on CAG (Comptroller & Auditor General) report.
According to reports, On Friday (Yesterday) CAG submitted the reports to Finance Minister in Parliament that the actor NTR has evicted the TAX of Rs 1.10 Crores on his “Nanaku Prematho” movie by showing an exception that the film was completely shot in London. But reported that the practices adopted by actors and film makers to evade service tax obligations.
For the films shot abroad, payments to artists for the portions shot abroad were paid through foreign companies and the service was made to look like ‘Export of Services’ with no tax liability. In the case of NTR, he was paid a remuneration of Rs 7.33 crore by a London-based company in 2015 for ‘Nannaku Prematho’. The actor has been found to have evaded service tax of Rs 1.10 crore on his remuneration citing that his film was shot extensively in London and other foreign nations, and thus his service must be treated as ‘Service export’ with no tax liability.
The CAG also advised the tax authorities to examine the complete loop of transactions among different entities related to ‘Nannaku Prematho’ movie to verify if due service tax has been levied. Based on the report submitted by CAG, Central Income Tax is preparing to serve notices to NTR.
The same issue has happened with one Bollywood film too, Randhir Kapoor got a tax exception for his film “Ae Dil Hai Mushkil” which was completely shot in New York. CAG submitted the reports to Central TAX department on these two films. According to reports, Kapoor received a consideration of Rs 6.75 crore from a foreign company ADHM Films (UK) based in London for a film shot in the UK and did not pay service tax of Rs 83.43 lakh treating the same as export of services.
But Central Tax department clarified that “Ae Dil Hai Mushkil” has completely shot in aboard, so the tax can be exempted. Coming to NTR case the department has convinced with CAG report and ready to serve notice to clear off the Rs 1.10 cr tax. Reports suggest that compulsory NTR need to clear of his evaded Tax of 1.10 Cr.