Satyam Computers Scam: Telangana HC admits plea to reopen assessments prior to the Scam
Satyam Computers Scam – Telangana HC – plea – reopen assessments – Scam – taxscan
Satyam Computers Scam – Telangana HC – plea – reopen assessments – Scam – taxscan
The Telangana High Court, on Wednesday, agreed to examine a case in which Rs 126 crore was paid as income tax on non-existent income by the former chairman of Tech Mahindra (formerly Satyam Computers) B Ramalinga Raju. The company has been attempting to correct the accounts since 2011, and if the plea is allowed, it could result in a refund.
Tech Mahindra took over the collapsed Satyam Computers following Raju's confession of falsifying accounts. The scam resulted in investors losing approximately Rs 14,000 crore in 2009, according to the Central Bureau of Investigation's probe.
During the hearing in the Telangana High Court, senior counsel K Vivek Reddy representing Tech Mahindra argued that former chairman Ramalinga Raju had presented inflated figures of sales and income to the public, and to make these figures appear real, he paid income tax on non-existent income.
Both the Central Bureau of Investigation and trial court determined that the company lost Rs 126 crore as a result of this tax payment.
On January 11, 2018, India’s market regulator, the Security Exchange Board of India (SEBI), on Wednesday, barred Pricewaterhouse’s networking entities from issuing audit certificates to any listed company in India for two years after finding the Firm guilty in the Satyam scam.
The Division Bench bench consisting of Chief Justice Ujjal Bhuyan and Justice N Tukaramji inquired if this was a case of the income tax department receiving unjust enrichment.
Vivek Reddy, in response stated that the company wanted the court to ask the department if they would allow them to correct previous assessments, as they were completed under the assumption that the account statements furnished by Ramalinga Raju for previous years were correct.
However, the bench went on to note that account statements should be seen as furnished by the company and not individuals.
The bench scheduled further examination of the issue on February 15 and adjourned the hearing after department counsel Sapna Reddy informed the court that an Additional Solicitor General from Chennai will come to argue the case.
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