Film producer held for service tax evasion

Film producer held for service tax evasion

| Aug 24, 2013, 07.35 AM (7star news)















MUMBAI: Samir Karnik, the producer of Yamla Pagla Deewana starring Dharmendra and his sons Sunny Deol and Bobby Deol, was arrested on Friday for service tax evasion of Rs 1.18 crore. It was the first arrest for the offence in Mumbai.



Karnik, the proprietor of Top Angel Production, had collected Rs 1.18 crore as service tax when he sold the satellite rights of the film to Eros International Media Ltd. However, he did not pass on the sum to the government.



Production companies are required to pay 12.36% service tax when they sell the satellite rights of their films.



Actor coughs up 86 lakh in service tax



Film producer Samir Karnik was on Friday arrested for evading Rs 1.18 crore in service tax. Those failing to deposit service tax of over Rs 50 lakh with the government within six months from the due date are liable to be arrested. They face a jail term of seven years.



\"We recorded Karnik\'s statement when he admitted to collecting service tax. We arrested him because he said he had no money to pay,\" an official said. Karnik, was, however, released by the metropolitan magistrate\'s court on a Rs 2 lakh bail.



Meanwhile, Sunny Deol has paid up Rs 86 lakh of the Rs 1.95 crore service tax he owes the government, a press release issued by service tax commissioner R Sekar said. The service tax department had on August 14 recorded Deol\'s statement after he failed to pay the levy collected from Viacom 18 which had bought the satellite rights of \'Yamla Pagla Deewana II\'. Deol is the director of Sunny Sounds Pvt Ltd which produced the movie. Officials said 132 letters have been issued to producers over the last year directing them to pay service tax received from sales of movie rights.



\"The response has been lukewarm. We will initiate action on a case to case basis ,\'\' an official said.



The department has also started a drive against 805 air-conditioned restaurants. \"Sixty per cent of them are not registered with the service tax department. We will initiate strict action against them,\'\' the official said. The government has also started a voluntary compliance encouragement scheme for those who have not registered with the department.
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