AR Rahman
CHENNAI: The income tax department has moved the Madras High Court claiming that the Oscar-winning music composer AR Rahman has channeled its income of more than Rs 3 million through AR Rahman Foundation, a charitable trust administered by him, to evade taxes.
In admitting the appeal filed by the department, a division bench of Judge TS Sivagnanam and Judge V Bhavani Subbaroyan ordered that the music composer be notified.
According to permanent senior income tax attorney TR Senthil Kumar, Rahman received an income of Rs 3.47 crore in fiscal year 2011-12 in connection with a deal made with UK-based Libra Mobiles.
The contract consisted of composing exclusive ringtones for the company and the term of the contract was three years. Under the contract, Rahman had ordered the company to pay his compensation directly to the foundation he runs, the department said.
“The income, which is taxable, must be received by Rahman. After due tax deduction, it can be transferred to the trust. But the same cannot be passed through the trust, since the income of the charitable trust is exempt from the Income Tax Law, ”said the lawyer.
Since the proceeding initiated by IT has been annulled by the income tax court, the department has transferred the present appeal to the higher court.
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