10 international airlines under DGGI scanner over tax evasion | India News

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NEW DELHI: The Directorate General of GST Intelligence (DGGI) has questioned executives from at least 10 leading foreign airlines during the last one month in an ongoing investigation related to alleged tax evasion, running into hundreds of crores of rupees, by these carriers for booking expenditure related to their India operations with their overseas head offices.
Finance managers of half-a-dozen airlines, including British Airways, Etihad, Thai Airways and Qatar Airways, have recorded their statements with DGGI. These executives are responsible for accounting and tax compliance issues related to their operations in India.
Prominent among those who have not yet appeared despite pending summons include Lufthansa, Emirates, Oman Airlines and Singapore Airlines. A few airlines, including Emirates, have been given a fresh date to appear for questioning, while a few others have sought more time as they are still in the process of gathering the required information from their headquarters.
Singapore Airlines officers have so far not appeared for questioning, although summons issued to it has been pending for few months now, sources told TOI. It has been asked to submit records of expenditure booked on its India-related operations.
In October, DGGI had carried out a series of searches on India offices of at least half-a-dozen foreign airlines to ascertain their tax liability. The action resulted in these carriers seeking fresh dates for submitting the required information by their overseas head offices.
According to sources, DGGI has asked these airlines to produce documents related to all expenditure booked by the foreign carriers with regard to their expenditure on India operations, which may include leasing of aircraft, expenditure of crew members, ground staff, airline fuel and any other spending on maintenance or repair.
This is for the first time that Indian authorities have asked foreign airlines to account for their India-related expenditure and pay tax for services rendered here under the new GST regime. This expenditure runs into millions of dollars for foreign carriers and shipping liners engaged in business activities in India.
The new GST regime treats Indian subsidiaries of any foreign company as two separate entities, and the former needs to comply with the tax rules applicable to any other company in India.



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