New Delhi: The cash-rich Indian Premier League (IPL) may be a billion dollar business today, but government gets almost nothing from it in terms of income tax.
The Board of Control for Cricket in India (BCCI), which runs the cash rich league, in its income tax returns showed that they have a ‘nil’ income for 2008-09 and earnings of just 14.86 crore for 2009-10.
However, contradicting BCCI’s claims, it is believed that the gross revenue earned by the IPL during the year 2009-10 is estimated to be Rs 661 crores. The huge revenue-income gaps have forced the government to start investigations into the whole matter.
Central Board of Excise and Customs realized Rs 94.32 crore by way of service tax with Rs 91 lakh as interest from 2007-10. But as many as 102 showcause notices as on February 1, 2011, raising a demand for service tax of Rs 160 crore, yielded a mere Rs 5 crore.
The data submitted by the revenue department to Parliament`s standing committee on finance shows that the IPL franchises filed very little as income tax. India Cements, owners of Chennai Super Kings, filed Rs 12.91 crore, Rajasthan Royal`s Jaipur Cricket Pvt Ltd Rs 4.53 crore, Deccan Chargers Rs 5.53 crore, King`s XI Punjab`s KPH Cricket Rs 4.25 crore, Kolkata Knight Riders Rs 5 crore, GMR`s Delhi Daredevil`s Rs 2.44 crore and Royal Challengers Rs 5.92 crore.
This led the committee, headed by former finance minister Yashwant Sinha asking for tax assessments for BCCI-IPL and its franchisees to be taken up on "priority". The committee even suspected hawala operations and round tripping by the different franchise to evade income tax.