Income Tax Dept Issues Statement On Surveys At BBC Offices In India, Flags Repeated Non-compliance

Amid ongoing 'survey raids' at the Delhi and Mumbai offices of the British broadcaster BBC, the Income Tax Department has come out with an official statement.

Income Tax Dept Issues Statement On Surveys At BBC Offices In India

New Delhi: Amid ongoing 'survey raids' at the Delhi and Mumbai offices of the British broadcaster BBC, the Income Tax Department has come out with an official statement.

In its statement, the I-T dept said, "Today, the Income Authorities conducted a survey on the BBC premises in Delhi, in view of the BBC’s deliberate non-compliance with the Transfer Pricing Rules and its vast diversion of profits."

According to the statement, "It is pertinent to note that the above exercise conducted by the tax authorities, is called “survey” not search/raid as per the provisions of the Income Tax Act. Such surveys are routinely conducted and are not to be confused to be in the nature of a search/raid."

The I-T department cited persistent non-compliance by BBC in relation to Transfer Pricing Rules and the diversion of profits.

"In the case of the BBC, there has been persistent non-compliance with the abovementioned rules for years. As a result of the same, several notices have been issued to the BBC. However, the BBC has been continuously defiant and non-compliant and has been significantly diverted their profits," it read.

The I-T department stated that the key focus of these surveys is to "look into manipulation of prices for unauthorised benefits, including tax advantages," adding "These surveys have been undertaken due to BBC’s persistent non-compliance of the norms, making it a repeat offender."

According to the I-T dept, the survey was done in connection with:

a. non-compliant under transfer pricing rules;
b. persistent and deliberately violative of transfer pricing norms; and
c. deliberately diverted significant amount of the profits and have not followed the arm’s length arrangement in the case of allocation of profit

"Accordingly, the surveys have been conducted with a view to investigate BBC’s violation of the Transfer Pricing Rules and its diversion of profits," the statement said.