The income tax department in India has accused the renowned musician AR Rahman for tax evasion. The Madras High Court has issued notice to the eminent singer-songwriter on the basis of the allegations.
According to the Income Tax Department, AR Rahman has evaded income tax of around Tk 3.5 crore. In 2011-12 financial year, Rahman earned Tk 3.46 crore by composing an exclusive ringtone for a UK-based telecom company. In that three-year contract, the way Rahman told the company to pay the money was in jeopardy. He told the company to deposit their dues in the AR Rahman Foundation.
According to the Times of India, citing the Income Tax Department, the mandatory payment of income tax should have been taken by Rahman himself. He could then submit it to the trust. But the income cannot be deposited directly in the trust. Because, the income of the charity is always tax free.
The tax department claims, “The income earned by AR Rahman is taxable.” This money cannot be exchanged through the charity as there is income tax exemption on the income of the voluntary organization. ” However, it is alleged that Rahman did not do so and took the money directly to the company's account. That is why the Income Tax Department approached the Madras High Court.
Before 2020, The Central Excise had directed Rahman to pay Tk 6.69 crore. The Madras High Court had issued a temporary stay on the order.
Incidentally, the voluntary organization run by AR Rahman works to create opportunities for education, music and a better life for the underprivileged, mentally and physically challenged.