Following the attachment of bank accounts of Tollywood actor Mahesh Babu, the legal team of the actor finally responded to the reports and accused the GST department of its lapses.
It was claimed that the due amount of Rs 18.5 lakh for which they levied a penalty of Rs 73.5 lakh was non-taxable.
According to the team, the accounts were attached even without issuing a notice, and also claimed that Mahesh Babu had several judicial pronouncements in his favor, though these were not elaborated on. The statement added that brand ambassador services were made taxable only from 2010.
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“The GST Commissionerate Hyderabad has attached the bank accounts for a disputed tax demand of Rs 18.5 lakhs claiming Rs 73.5 lakhs towards Tax interest and the penalty for brand ambassador services rendered in FY 2007-08 which was not taxable service,” the press release reads.
“The brand ambassador services were brought in the statute by insertion of section 65(105)(zzzzq) with effect from 1-7-2010. The GST Commissionerate Hyderabad has carried out the attachment without notice when several judicial pronouncements on this issue are in favor of the taxpayer and more so when the dispute is pending before the High Court,” it adds.
The department attached the actor’s Axis bank and ICICI bank account for an amount of Rs 73.5 lakh towards tax, interest, and penalty. After attaching his bank accounts, the GST Commissionerate recovered Rs 42 lakh.
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