IT raids on Tamil Nadu film distributors; Rs200 crore unearthed so far
Distributors have formed syndicates and suppress theatre collections in Tamil Nadu
Tamil film industry is facing a serious threat after a long time
The Income Tax Department had raided producers, distributors, and financiers associated with the Tamil film industry on 2 August 2022. Search operations were conducted at almost 40 premises located in Chennai, Madurai, Coimbatore and Vellore, said the department.
So far, the searches have detected undisclosed income of more than Rs.200 crore. Undisclosed cash of Rs.26 crore and unaccounted gold jewellery exceeding Rs.3 crore have also been seized.
Further, the searches revealed documents like promissory notes, etc, relating to unaccounted cash loans, which were advanced to various film production houses and others. In the cases of film production houses, evidences reveal tax evasion, as the actual amounts realized from the release of the films are much more than the amounts shown in the regular books of account, said the department.
Evidences also point to collection of unaccounted cash from the theatres. “As per the evidences, the distributors have formed syndicates and have systematically suppressed the theatre collections, resulting in the suppression of actual income,” said the department.
The Tamil movie industry is closed space dominated by the big-wigs of the state with connections at the highest political levels. Often, films are produced that promote a certain political party and the separatist ideology, camouflaged as Dravidian. Merit doesn’t work at all and a movie could be killed by distributors if the producers do not fall in line.
Income tax raids could not only hurt the financiers and distributors, but also open a can of worms for all politicians in Tamil Nadu. It could also have a cascading effect on Bollywood, given the film industry is considered a safe haven for black money.
Further investigation is going on.
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