For assessment year 2007-08
New Delhi Television announced that the Company has received an order from the Income Tax Department (Department) calling an investment by a reputed investor a "sham transaction". This follows an earlier similar order for assessment year 2009-10, calling the investment by NBCU - a subsidiary of General Electric - also a "sham transaction". The latest order is under section 148/143(3) of Income Tax Act, 1961, raising a tax demand of Rs. 47.27 crore for the assessment year 2007-08.The Department has disallowed the investment of US$ 20 Million by M/s Fuse + Media Holding LP (Fuse +Media), a wholly owned subsidiary of M/s. Velocity Interactive Group in NDTV Networks Plc. (NNLPC), erstwhile subsidiary of the Company, and taxed it as unexplained investment in the hands of NDTV. Fuse + Media Group is a respected and leading Silicon Valley investment company and continues to be invested in NDTV Group till date.
Based on the legal advice received from senior counsel, the Company strongly believes that the said order is untenable and misconceived. The Company will challenge the said order before the appropriate forum and believes that it has a strong chance of success in such proceedings.
The present disclosure is issued without prejudice to the rights and contentions of the Company before any regulatory authority or tribunal.
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