Tax evasion case: HC sends notice to A R Rahman


The Madras High Court has sent a notice to Oscar-Grammy winning music composer A R Rahman, based on a case filed by the Income Tax Department which has allegedly found that Rahman routed 3.47 crore remuneration he got from a UK based telecom company to his charitable trust Rahman Foundation in 2011.

According to the senior standing counsel for the Income Tax department, TR Senthil Kumar, “Rahman had entered into a three-year agreement with a company in the UK to compose ringtone for them, for which, an amount of over ` 3 crore was agreed to be paid. But he had said that the amount could be sent to his foundation.

For a trust, if it fulfills some conditions, all its income would be exempted from tax under Section 11 and 13 of the Income Tax Act 1961. By routing the full money to the trust, he does not want to pay tax. If the same amount had come directly to him, after paying the tax, he could have used the balance amount as he wished. That’s what the law says.

The creation of music is done by his individual skills and abilities. It is in no way connected with the foundation, (though) he happens to be its managing trustee. So, when it is offered to the foundation, without the permission of the central government, that’s also a violation under Foreign Contribution (Regulation) Act, 1976.” It is said that Rahman would file a reply to the notice.


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