Taxing times still ahead for Dutt

Vivek Sinha

Imperial Heights, where the flats are situated

Actor Sanjay Dutt may have been a happy man on Wednesday morning, when a sessions court upheld his marriage to Manyata after pronouncing her divorce from her first husband valid, but there's more trouble brewing.

This time around, it's money matters that may give Dutt the jitters: the Income-Tax department has ascertained in a recent valuation report that he owes them over Rs 50 crore in capital gains tax arrears.

The actor - who earns around Rs 2 crore per film - has allegedly refused to pay capital gains tax (payable on income accruing from sale of property) for years on the sale of nine flats he owned in the Imperial Heights building at Pali Hill, Bandra, brushing aside several reminders sent to him by the I-T department.

According to sources in the I-T department, the taxes have now piled up to over Rs 50 crore, which includes interest and penalties since the building was completed and became ready for possession around five years ago.

The lump-sum amount Dutt got from the builders - Lokhandwala Construction - is also taxable.

Imperial Heights is an 11-storey building which was developed by Lokhandwala Construction on the plot where the late Sunil Dutt had a bungalow.

Sources said at the time of giving the land to Lokhandwala Construction, the senior Dutt was going through a financial crisis and so could not afford to build the structure himself.

Also, his son was embroiled in court cases, which left him with little time to supervise construction work.

After the building was completed by Lokhandwala Construction, they handed over 11 out of 22 flats to the Dutt family as per the agreement.

They were all plush flats with four bedrooms and a hall, each sprawling over 2,275 sq ft and currently priced at around Rs 40,000 per sq feet (Rs 9 crore for each flat).

The Dutts retained two penthouse apartments for themselves and sold off nine flats they got as part of the deal within a year.

Sanjay Dutt
However, according to I-T sources, the actor kept telling the taxmen he would start paying taxes in instalments as and when he sold the flats.

Sources say that though nine flats have been sold off and are now occupied, the actor has not paid a single paisa in capital gains tax till date.

Left with no option, the I-T department has now ordered a valuation report to ascertain the exact amount to be recovered from the actor, which according to preliminary estimates has been put at Rs 50 crore.

Sanjay Dutt did not respond to several SMSes sent to him by this paper for his comment.
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