The Income Tax (I-T) department and Enforcement Directorate (ED) are reported to have begun a discreet enquiry into the source of funds of certain franchisees of the cash-rich T20 Indian Premiere League (IPL). Official sources said today the “source probe” commenced after a controversy broke out this week over the share holding patterns of the consortium led by Rendezvous which bagged IPL Kochi franchise. The controversy has triggered a spat between IPL Commissioner Lalit Modi and Minister of State for External Affairs Shashi Tharoor.
Sources said the probe has been initiated to find out if there is any illegal flow of funds or whether any black money in being pumped into the sporting extravaganza including from foreign shores.
However, sources maintained that the ’source probe’ is just an enquiry and may or may not end up in filing of a case.
The probe is only to determine the source of funds though there is no specific input that fuelled suspicions, the sources said. Since amounts in thousands of crores are involved, there is a need to cross check the funding routes, the sources added.
The probe move came even as the CPI-M said the government should inquire into the source of certain funds flowing into the tournament and reconsider whether any tax exemptions or concessions are justified for this commercial enterprise.
Meanwhile, the government is expected to rake in more than Rs 200 crore as taxes from the third edition of the ongoing IPL T20 cricket tournament.
According to Finance Ministry sources, the taxes would be accrued as Tax Deducted at Source (TDS) from the remuneration paid to players, umpires, coaches, commentators among others under theincome tax category while advertising, marketing and consultancy services of the sporting extravaganza will be taxed under the service tax bracket.
As per the estimate calculated by the field formations of the Revenue department, the IPL will fetch about Rs 100 crore each under the direct (income tax) and indirect (service tax) categories.
Income Tax Department visited IPL Headquarter
A special team of the Income Tax (I-T) department today visited the headquarters of the cash-rich T20 Indian Premiere League (IPL) in connection with an inquiry into financial details and share holding patterns of all the IPL franchisees.
Official sources said the team’s visit was part of a “source probe” that has been initiated by the Department of Revenue in the Ministry of Finance to look into the financing aspects of the multi-crore IPL in the wake of the controversy over the funding of IPL Kochi, the new franchisee. The IPL is housed in the BCCI building at the Wankhede stadium.
Sources maintained that the visit cannot be termed as a “survey or a search” and that it was undertaken under Section 133 (6) of theIncome Tax Act which pertains to the power to call for information. The team also sought some documents.
IPL Commissioner Lalit Modi said the IT team’s visit was only an inquiry and not a raid.
The I-T department has created a special cell in Mumbai to keep a tab on all income generated by the IPL, the sources said.
It said the probe has been initiated to find out if there is any illegal flow of funds or whether any black money in being pumped into the sporting extravaganza including from foreign shores.
The probe move came even as the CPI-M said the government should inquire into the source of certain funds flowing into the tournament and reconsider whether any tax exemptions or concessions are justified for this commercial enterprise.
