I-T dept moves SC against Kiran Karnik in tax evasion matter

The Income Tax department has moved the Supreme Court alleging that former IT industry body Nasscom chief Kiran S Karnik had evaded tax to the tune of Rs 3.71 crore in 2002-03 when he was heading infotainment company Discovery Networks.

The tax authorities challenged a Gujarat High Court judgement that had dismissed their appeal holding that Karnik could not be held guilty of even deemed concealment.

A bench headed by Justice D K Jain, while posting the matter for final hearing, rejected Karnik's counsel P K Manohar's plea to allow him to file a counter affidavit. The bench said there was no need to file the affidavit keeping in view the nature of the matter.

Seeking imposition of penalties which were deleted by the sectoral tribunal under the I-T Act 1961, the department has alleged that Karnik had failed to prove with evidence that he was under bonafide belief that UAP (Unit Appreciation Plan, an incentive scheme) receipts were not taxable.

According to the Revenue, the assessee had not concealed his particulars of his income but had furnished inaccurate particulars of such income.

Karnik, as the managing director of Discovery Networks that owns Discovery channel, had received around Rs 1.30 crore and Rs 3.72 crore for 2001-02 and 2002-03, respectively, from US-based parent of the Indian firm. While he had disclosed the same in his Income Tax returns, he had claimed exemption from tax as the amount was received in the nature of gifts through his employer in India.