Income, profits of BBC not commensurate with operations in India: CBDT

A statement, without naming the media organisation, said crucial pieces of evidence were unearthed, including digital proof and documents.

BySouth First Desk

Published Feb 17, 2023 | 8:58 PMUpdatedFeb 17, 2023 | 8:58 PM

BBC office in London. (mikeinlondon)

The Union Ministry of Finance released an official statement on Friday, 17 February, stating that the income and profits shown by various BBC-group entities were not commensurate with the scale of their operations in India.

The statement came a day after income tax (I-T) authorities ended a three-day-long survey of the British media organisation in India.

The Central Board of Direct Taxes (CBDT) issued the statement without naming the media organisation and said that I-T teams unearthed crucial pieces of evidence by way of statements of employees, digital proof and documents.

“During the course of the survey, the Department gathered several evidences pertaining to the operation of the organisation which indicate that tax has not been paid on certain remittances which have not been disclosed as income in India by the foreign entities of the group,” said the board in the statement.

According to the statement, several discrepancies and inconsistencies with regard to transfer pricing documentation were found during the survey.

Related: I-T teams ‘survey’ BBC offices in Delhi and Mumbai

Discrepancies, inconsistencies found

“The survey operations also revealed that services of seconded employees have been utilised for which reimbursement has been made by the Indian entity to the foreign entity concerned. Such remittance was also liable to be subject to withholding tax which has not been done. Further, the survey has also thrown up several discrepancies and inconsistencies with regard to Transfer Pricing documentation,” the board added.

The survey was launched on 14 February at BBC offices in Delhi and Mumbai and it ended after about 60 hours on Thursday night.

Earlier, the officials said that the survey was carried out to investigate issues related to international taxation and transfer pricing of BBC subsidiary companies.

On 14 February, the ruling BJP had accused the BBC of “venomous reporting” while the Opposition had questioned the timing of the action that came weeks after the broadcaster aired a two-part documentary, India: The Modi Question, on Prime Minister Narendra Modi and the 2002 Gujarat riots.

Meanwhile, the Editors Guild of India expressed concern over the I-T surveys at the offices of BBC India.

The statement alleged that the survey by the I-T department is a continuation of the trend of using government agencies to “harass or intimidate” press organisations who are critical of the ruling dispensation at the Centre.

Related: HCU students screen BBC documentary on campus

The BBC documentary controversy

Earlier, the Supreme Court on 10 February, dismissed a plea seeking to impose a complete ban on the BBC in India — because of the media giant airing the documentary India: The Modi Question — saying it was “entirely misconceived”.

On 3 February, the apex court sought responses from the Centre and others on separate petitions challenging its decision to block the documentary from being viewed in India.

The top court had on that day also directed the Central government to produce original records relating to its decision to block the BBC documentary.

On 21 January, the central government issued directions for blocking multiple YouTube videos and Twitter posts sharing links to the controversial documentary.

However, screenings of the documentary were held across the country including public spheres, and university campuses.