Keep 25% of F1 ticket money to pay tax: SC
The Supreme Court on Friday directed Jaypee Sports International Ltd that is organising the Formula One Indian Grand Prix, to deposit 25% of the ticket sale proceeds in a separate bank account. Bhadra Sinha reports.india Updated: Oct 22, 2011 03:49 IST
The Supreme Court on Friday directed Jaypee Sports International Ltd that is organising the Formula One Indian Grand Prix, to deposit 25% of the ticket sale proceeds in a separate bank account.
The apex court direction followed a public interest litigation questioning the legality of the entertainment tax relief given by the UP government.
A bench of justice DK Jain and justice AR Dave restrained Jaypee Sports from operating the account without the court's permission till the final outcome of the PIL.
Although India's first F-1 event - scheduled to begin in Greater Noida in the national capital region on October 28 - would not be affected, the court said that it would examine whether the track was built according to the development plan of the area.
Rejecting the company's argument that the direction would cause adverse publicity, the bench said since the money would be deposited in a no-lien account, "how it can cause adverse publicity we do not understand".
The petitioner's counsel, Sanjiv Sen, contended that Formula One was an elitist event and there was no justification for granting tax relief. In response, government counsel Gopal Subramanium said the stadium and the event were part of the state's special development zone project.
At this, the bench said it would also examine UP government's policy of acquiring land for developing the special economic zone.