The Supreme Court on Wednesday ordered a fresh assessment of superstar Amitabh Bachchan’s income tax accounts for 2001-2002, saying the department was right to issue a show-cause notice to the actor who claimed a 30% exemption for personal security expenses.
In his March 2003 income tax return, Bachchan claimed a 30% tax exemption out of his `3.17 crore income on account of personal security expenses. The assessing officer asked him to file the requisite details in this regard.
Through his chartered accountant, Bachchan responded on February 13, 2004. He said the money was spent on personal security by employing guards and agencies to ward off threats from gangsters and extortionists. The star subsequently withdrew the claim and said his chartered accountant wrongly advised him on seeking the exemption. He requested that he be allowed to withdraw the return he filed.
But the claim was rejected by the chief income tax commissioner, who issued a show cause notice asking why the exemption sought should not be treated as unexplained expenditure.
Bachchan’s response was accepted by the assessing officer, but the commissioner I-T rejected it. The CI-T’s views were rejected by the tribunal and the Bombay high court – both of which ruled in the actor’s favour.An SC bench headed by justice Ranjan Gogoi upheld the income tax department’s appeal challenging the Bombay HC verdict.