Income tax case ruled in favour of Shah Rukh Khan

Shah Rukh Khan was served notices by the income-tax department who alleged that the actor had not paid proper tax on his income he made from hosting 'Kaun Banega Crorepati'. Two cases were filed against Shah Rukh - in the first case, ITAT allowed SRK a deduction of Rs 10 crore that was paid to him for Kaun Banega Crorepati that then aired on Star Plus. Whereas, the second instance was a tax demand of Rs 7 crore, also for professional fees the actor had charged from Star India, the broadcaster, that owns Star Plus.

However, the Income Tax Appellate Tribunal (ITAT) ruled in favour of Shah Rukh leaving the income tax department flummoxed. The IT department had sent notices to the actor IT department had sent tax notices to the actor for avoiding tax also asking him to present details of his investments in Bermuda, British Virgin Islands (BVI), and Dubai.

According to a report in Economic times, Star India and SRK entered into an agreement for a total of 104 episodes, however, after 52 episodes, the TV channel decided to shelve the remaining episodes. Star India wanted to recover the money from the actor, but instead of returning the money, SRK struck a barter deal with the channel. According to the deal, Shah Rukh secured a sponsorship along with Kolkata Knight Riders IPL team. Shah Rukh would pay Rs 10 crore to the team and in return sponsorship rights were to be given to Star India.

While Khan claimed that Rs 10 crore was his expense for computing business, the tax officer wanted Khan to pay tax on the income that included Rs 10 crore. However, Shah Rukh is now relieved from the two charges as the ITAT ruled in favour of the actor.