Since 2007- 08, the income tax department has levied huge amounts of taxes on the Board of Control for Cricket in India (BCCI), and not even once has the Board paid the entire amount assessed. It is because the BCCI contends that the assessment has not been correct, though it has paid a certain amount in each of the years under protest.
The Office of the Assistant Commissioner of Income Tax (Central Circle - 35), Mumbai, assessed a total tax of 3,276.55 crore for four years, from 2007- 08 to 2010- 11 and actually demanded a total of Rs. 986.46 crore. Of this amount, the BCCI paid only 596.83 crore while choosing to make several WI bowlers several appeals, as per a reply given to an RTI application moved by Subhash Agrawal.
It is because of the appeals that the Board has made that the unpaid tax amount is shown as 354.26 crore.
For the assessment year 2009- 10, the period during which IPL-2 was staged in South Africa, the income tax department “rectified” the arrears figure. Originally, the figure was 106.09 crore, but it was reduced by 35.37 crore. Still, the Board owes 70.72 crore to the tax department.
Surprisingly, the assistant commissioner’s office said that the assessment for bowlers keep 2011- 12 was still “pending”. The BCCI contends that a lot of its income should not have been taxed and that the department has wrongly assessed its incomes over the years.
On the other hand, the Director of Income Tax ( Mumbai) had, in December 2009, informed the BCCI that the registration it was granted under Section 12A of the Income Tax Act 1961 was no more valid from June 1, 2006, the day the Board amended its “objects” and the “memorandum” to provide monetary assistance to athletes of other sports.
The BCCI appealed to the Income Tax Appellate Tribunal ( ITAT) against the communication, but it was dismissed as “non-maintainable” in an order dated March 20, 2012. The ITAT held that the benefits of registration under Section 12A could not be extended to the amended objects.