Indian authorities accuse BBC of tax evasion after searches

By ASHOK SHARMA
Associated Press

NEW DELHI (AP) — India’s Finance Ministry accused the BBC of tax evasion on Friday, saying that it had not fully declared its income and profits from its operations in the country.

Indian tax authorities ended three days of searches of the British broadcaster’s New Delhi and Mumbai offices on Thursday night. Opposition political parties and other media organizations have criticized the searches as an attempt to intimidate the media.

Critics of Prime Minister Narendra Modi have also questioned the timing of the searches, which came weeks after the BBC aired a documentary in the U.K. that was critical of Modi.

“The department gathered several evidences pertaining to the operation of the organization which indicate that tax has not been paid on certain remittances which have not been disclosed as income in India by the foreign entities of the group,” the Central Board of Direct Taxes said in a statement.

It said they found “several discrepancies and inconsistencies“ and had gathered “crucial evidence” from statements of employees, digital evidence and documents which would be examined more fully later.

The statement also accused the BBC of not paying full taxes on the earnings of employees who came from abroad and worked in India for short durations.

The BBC said in a statement that it would “respond appropriately to any direct formal communication received from the Income Tax Department.”

“We are supporting staff -– some of whom have faced lengthy questioning or been required to stay overnight -– and their welfare is our priority. Our output is back to normal and we remain committed to serving our audiences in India and beyond,” it said.

The Press Trust of India news agency cited unidentified officials as saying on Thursday that investigators collected financial data from select BBC staffers and made copies of electronic and paper data from the news organization.

It said the authorities were investigating issues related to international taxation and transfer pricing of BBC subsidiary companies.

The leader of India’s main opposition Congress party, Mallikarjun Kharge, described the search of the BBC offices as an assault on freedom of the press under Modi’s government.

Reporters Without Borders, an international media watchdog, denounced the government’s action as “attempts to clamp down on independent media.”

“These raids have all the appearance of a reprisal against the BBC for releasing a documentary critical of Prime Minister Narendra Modi three weeks ago. They have come at a time when independent media are being hounded more and more, and when pluralism is shrinking in India due to increased media concentration,” the group said in a statement on Thursday.

The documentary, “India: The Modi Question,” was broadcast in the U.K. last month, examining the prime minister’s role in 2002 anti-Muslim riots in the western state of Gujarat, where he was chief minister at the time. More than 1,000 people were killed in the violence.

Modi has denied allegations that authorities under his watch allowed and even encouraged the bloodshed, and the Supreme Court said it found no evidence to prosecute him. Last year, the court dismissed a petition filed by a Muslim victim questioning Modi’s exoneration.

The program drew an immediate backlash from India’s government, which invoked emergency powers under its information technology laws to block it from being shown in the country. Local authorities scrambled to stop screenings organized at Indian universities, and social media platforms including Twitter and YouTube complied with government requests to remove links to the documentary.

The BBC said at the time that the documentary was “rigorously researched” and involved a wide range of voices and opinions.

“We offered the Indian Government a right to reply to the matters raised in the series — it declined to respond,” it said.

India’s Foreign Ministry called the documentary a “propaganda piece designed to push a particularly discredited narrative” that lacked objectivity.

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Associated Press writer Jill Lawless in London contributed to this report.