Emaar MGF Owner Gupta Seeks Immunity: Economic Times

Shravan Gupta discloses undeclared income of Rs 31 crore before the Income Tax Settlement Commission & declares 3 accounts in HSBC Bank, Geneva.

Emaar MGF owner Shravan Gupta has disclosed an undeclared income of over 31 crore before the Income Tax Settlement Commission (ITSC) while seeking immunity from levy of penalty and initiation of prosecution proceedings. The undeclared income is linked to transaction with a Dubaibased company . Gupta has also declared three accounts in HSBC Bank, Geneva. Gupta filed the Settlement Application for the assessment years from 2006-07 to 2014-15 on February 19 this year and declared additional income for these years. The settlement mechanism allows taxpayers to disclose additional income over and above what has been disclosed before the Income tax Department. The applicant has to pay tax and interest on the additional income disclosed before the Commission, before filing the application. If the Commission admits the application, it has to complete the settlement process in a time-bound manner after hearing the applicant and income-tax authorities.

ET has reviewed official documents, according to which, on February 25, the ITSC admitted Gupta's application and declared it to be valid for seeking a report from the Income Tax Department (ITD).

Earlier, the ITD had served notices on Gupta as a consequence of a search and seizure action, conducted last year. Emaar MGF did not respond to an email for comments.

In his application, Gupta has claimed that he was also a settler of trusts named “Amrita Trust“, with his family members as beneficiaries. These trusts were created under an incorporated JV agreement with Mohammed Ayub Sheikh Mohammed Shahid. There were six companies incorporated, owned and controlled outside India by Ayub's office in Dubai and that Gupta had no investment in the said trust.

Further Shravan Gupta and Sheikh Ayub entered into a joint venture agreement to identify , evaluate and invest in real estate projects outside India with a focus on Dubai and London. Later, a new trust was established by the name of Mayfair Trust. Then differences arose and the joint venture agreement was terminated and all rights were transferred to Sheikh Ayub. According to Gupta's application: “As consideration for efforts made by Sharavan Gupta, Sheikh Ayub had agreed to not cancel life insurance policy from Transamerica Life and handed over the original papers and net insurance premium amounting to $4,348,112 (over 22 crore), paid by Wintec worldwide on August 19, 2011, this was the final settlement.“ The insurance premium 22 crore) and credit card with(.drawals (2011 onwards) amounting to over 6 crore form part of additional income of 31crore declared before ITSC. As far as the foreign bank accounts are concerned, Gupta claimed that his late father-in-law had made these deposits. All relevant credit entries have already been offered to Income Tax by way of revised returns filed for the assessment years from 2006 to 2009. In January 2014, Emaar MGF spokesperson had told ET that, “Shravan Gupta had made voluntary disclosures with respect to his HSBC account in Geneva. The account was opened in 2006 and closed in 2007.Gupta had voluntarily provided all information pertaining to this account to the I-T department and had paid all the taxes and penalties related to the account even before a showcause notice was issued in this regard. The peak balance in the account was 6 crore and the equivalent tax and interest amount of  4 crore approximately was deposited in 2011 voluntarily.“